Copa Holdings Reports Net Income of US$95.9 Million and EPS of US$2.16 for the First Quarter of 2012
Excluding special items, adjusted net income came in at $90.6 million, or EPS of $2.04 per share
PANAMA CITY, May 9, 2012 /PRNewswire/ -- Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the first quarter of 2012(1Q12). 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 2011 (1Q11).
OPERATING AND FINANCIAL HIGHLIGHTS
- Copa Holdings reported net income of US$95.9 million for 1Q12, or diluted earnings per share (EPS) of US$2.16. Excluding special items, Copa Holdings would have reported an adjusted net income of $90.6 million, or $2.04 per share, a 10.5% increase over adjusted net income of US$82.0 million and US$1.86 per share for 1Q11.
- Operating income for 1Q12 came in at US$111.6 million, a 12.0% increase over operating income of US$99.6 million in 1Q11. Operating margin for the period came in at 20.5%, compared to 23.7% in 1Q11, mostly as a result of a 19.5% increase in the effective price of jet fuel.
- Total revenues increased 29.5% to US$543.3 million, outpacing a strong capacity expansion. Yield per passenger mile increased 6.8% to 17.7 cents and operating revenue per available seat mile (RASM) increased 5.5% to 14.2 cents, despite a 15.6% increase in average length of haul.
- For 1Q12, robust demand trends resulted in passenger traffic (RPMs) growth of 22.4% on a 22.8% capacity expansion. Consolidated load factor came in at 77.2%, or 0.2 percentage point below 1Q11.
- Operating cost per available seat mile (CASM) increased 9.9%, from 10.3 cents in 1Q11 to 11.3 cents in 1Q12. CASM, excluding fuel costs, increased 4.2% to 6.8 cents, mainly due to increased passenger servicing and aircraft rental costs.
- Cash, short term and long term investments ended 1Q12 at US$647.8 million, representing 33% of the last twelve months' revenues.
- During the first quarter, Copa Airlines took delivery of four Boeing 737-800 aircraft. As a result, Copa Holdings ended the quarter with a consolidated fleet of 77 aircraft.
- For 1Q12, Copa Holdings reported consolidated on-time performance of 85.9% and a flight-completion factor of 99.6%, maintaining its position among the best in the industry.
RECENT DEVELOPMENTS
- The Board of Directors of Copa Holdings S.A. (NYSE: CPA) at its regular meeting held on May 9, 2012, declared an annual dividend of US$2.10 per share on all outstanding Class A and Class B shares. This dividend, which is in accordance with the Company's dividend policy, represents 30% of 2011 consolidated net income. The dividend will be paid on June 15, 2012 to stockholders of record as of May 31, 2012.
Consolidated Financial & Operating Highlights |
1Q12 |
1Q11 |
% Change |
4Q11 |
% Change |
|
Revenue Passengers Carried ('000) |
1,714 |
1,619 |
5.8% |
1,737 |
-1.3% |
|
RPMs (mm) |
2,954 |
2,414 |
22.4% |
2,722 |
8.5% |
|
ASMs (mm) |
3,829 |
3,119 |
22.8% |
3,635 |
5.3% |
|
Load Factor |
77.2% |
77.4% |
-0.2 p.p. |
74.9% |
2.3 p.p. |
|
Yield |
17.7 |
16.6 |
6.8% |
17.8 |
-0.6% |
|
PRASM (US$ Cents) |
13.7 |
12.9 |
6.4% |
13.4 |
2.5% |
|
RASM (US$ Cents) |
14.2 |
13.4 |
5.5% |
14.0 |
1.2% |
|
CASM (US$ Cents) |
11.3 |
10.3 |
9.9% |
10.9 |
3.0% |
|
CASM Excl. Fuel (US$ Cents) |
6.8 |
6.5 |
4.2% |
6.9 |
-0.7% |
|
Breakeven Load Factor (1) |
61.2% |
58.3% |
2.9 p.p. |
59.0% |
2.2 p.p. |
|
Fuel Gallons Consumed (Millions) |
51.3 |
41.6 |
23.2% |
47.3 |
8.3% |
|
Avg. Price Per Fuel Gallon (US$ Dollars) |
3.33 |
2.79 |
19.5% |
3.14 |
6.1% |
|
Average Length of Haul (Miles) |
1,724 |
1,492 |
15.6% |
1,567 |
10.0% |
|
Average Stage Length (Miles) |
1,066 |
968 |
10.1% |
1,066 |
0.0% |
|
Departures |
26,647 |
24,943 |
6.8% |
25,499 |
4.5% |
|
Block Hours |
73,480 |
60,760 |
20.9% |
68,479 |
7.3% |
|
Average Aircraft Utilization (Hours) |
11.0 |
10.6 |
3.5% |
10.4 |
5.3% |
|
Operating Revenues (US$ mm) |
543.3 |
419.5 |
29.5% |
509.4 |
6.6% |
|
Operating Income (US$ mm) |
111.6 |
99.6 |
12.0% |
111.5 |
0.0% |
|
Operating Margin |
20.5% |
23.7% |
-3.2 p.p. |
21.9% |
-1.4 p.p. |
|
Net Income (US$ mm) |
95.9 |
94.4 |
1.6% |
104.4 |
-8.1% |
|
Adjusted Net Income (US$ mm) (1) |
90.6 |
82.0 |
10.5% |
85.3 |
6.2% |
|
EPS - Basic and Diluted (US$) |
2.16 |
2.14 |
1.1% |
2.36 |
-8.2% |
|
Adjusted EPS - Basic and Diluted (US$) (1) |
2.04 |
1.86 |
10.0% |
1.93 |
6.1% |
|
# of Shares - Basic and Diluted ('000) |
44,341 |
44,139 |
0.5% |
44,315 |
0.1% |
|
(1) Breakeven Load Factor, Adjusted Net Income and Adjusted EPS for 1Q12, 1Q11, and 4Q11 exclude non-cash charges/gains associated with the mark-to-market of fuel hedges.
Note: Attached to this press release is a reconciliation of non-IFRS financial measures to the comparable IFRS measures.
FULL 1Q12 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT: http://investor.shareholder.com/copa/results.cfm
1Q12 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST
Date: |
May 10, 2012 |
|||||
Time: |
11:00 a.m. US EDT (10:00 a.m. Local Time) |
|||||
Conference telephone number: |
877-293-5456 (US Domestic Callers) |
|||||
707-287-9357 (International Callers) |
||||||
Webcast: |
||||||
Speakers: |
Pedro Heilbron, Chief Executive Officer |
|||||
Victor Vial, Chief Financial Officer |
||||||
CONTACT: Copa Holdings S.A.
Investor Relations:
Ph: (507) 304-2677
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 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 |
% |
||
1Q12 |
1Q11 |
Change |
4Q11 |
Change |
||
Operating Revenues |
||||||
Passenger Revenue |
523,812 |
400,887 |
30.7% |
485,324 |
7.9% |
|
Cargo, mail and other |
19,444 |
18,661 |
4.2% |
24,125 |
-19.4% |
|
Total Operating Revenue |
543,257 |
419,548 |
29.5% |
509,449 |
6.6% |
|
Operating Expenses |
||||||
Aircraft fuel |
170,875 |
116,141 |
47.1% |
148,678 |
14.9% |
|
Salaries and benefits |
57,536 |
48,345 |
19.0% |
57,854 |
-0.5% |
|
Passenger servicing |
49,433 |
34,983 |
41.3% |
45,903 |
7.7% |
|
Commissions |
22,223 |
18,072 |
23.0% |
19,750 |
12.5% |
|
Reservations and sales |
20,090 |
15,472 |
29.8% |
18,813 |
6.8% |
|
Maintenance, material and repairs |
20,530 |
15,344 |
33.8% |
22,323 |
-8.0% |
|
Depreciation |
20,526 |
17,817 |
15.2% |
19,727 |
4.1% |
|
Flight operations |
25,039 |
19,869 |
26.0% |
22,251 |
12.5% |
|
Aircraft rentals |
17,300 |
11,227 |
54.1% |
15,573 |
11.1% |
|
Landing fees and other rentals |
10,846 |
9,717 |
11.6% |
10,388 |
4.4% |
|
Other |
17,300 |
12,975 |
33.3% |
16,684 |
3.7% |
|
Total Operating Expense |
431,699 |
319,963 |
34.9% |
397,943 |
8.5% |
|
Operating Income |
111,558 |
99,585 |
12.0% |
111,506 |
0.0% |
|
Non-operating Income (Expense): |
||||||
Interest expense |
-7,959 |
-7,926 |
0.4% |
-8,808 |
-9.6% |
|
Interest capitalized |
0 |
0 |
nm |
0 |
nm |
|
Interest income |
2,286 |
1,252 |
82.7% |
2,152 |
6.2% |
|
Other, net |
4,866 |
10,876 |
-55.3% |
11,605 |
-58.1% |
|
Total Non-Operating Income/(Expense) |
-806 |
4,202 |
n/a |
4,950 |
-116.3% |
|
Income before Income Taxes |
110,751 |
103,787 |
6.7% |
116,456 |
-4.9% |
|
Provision for Income Taxes |
14,822 |
9,341 |
58.7% |
12,073 |
22.8% |
|
Net Income |
95,930 |
94,446 |
1.6% |
104,383 |
-8.1% |
|
EPS - Basic and Diluted |
2.16 |
2.14 |
1.1% |
2.36 |
-8.2% |
|
Shares - Basic and Diluted |
44,340,562 |
44,139,277 |
0.5% |
44,314,505 |
0.1% |
|
Copa Holdings, S.A. |
|||
Balance Sheet - IFRS |
|||
(US$ Thousands) |
March 31, |
December 31, |
|
2011 |
2011 |
||
(Unaudited) |
(Audited) |
||
ASSETS |
|||
Current Assets: |
|||
Cash and cash equivalents |
$ 218,665 |
$ 243,801 |
|
Short-term investments |
254,303 |
262,345 |
|
Total cash, cash equivalents and short-term investments |
472,969 |
506,146 |
|
Accounts receivable, net of allowance for doubtful accounts |
150,173 |
142,297 |
|
Accounts receivable from related parties |
273 |
704 |
|
Expendable parts and supplies, net of allowance for obsolescence |
46,688 |
42,382 |
|
Prepaid expenses |
45,748 |
40,058 |
|
Other current assets |
27,317 |
22,655 |
|
Total Current Assets |
743,167 |
754,242 |
|
Long-term investments |
174,852 |
104,834 |
|
Property and Equipment: |
|||
Owned property and equipment: |
|||
Flight equipment |
2,128,532 |
2,036,983 |
|
Other equipment |
69,777 |
67,577 |
|
2,198,309 |
2,104,560 |
||
Less: Accumulated depreciation |
(366,983) |
(346,656) |
|
1,831,326 |
1,757,904 |
||
Purchase deposits for flight equipment |
235,183 |
242,287 |
|
Total Property and Equipment |
2,066,508 |
2,000,191 |
|
Other Assets: |
|||
Net pension asset |
9,120 |
8,974 |
|
Goodwill |
27,208 |
25,099 |
|
Intangible asset |
51,186 |
47,047 |
|
Other assets |
133,234 |
125,409 |
|
Total Other Assets |
220,748 |
206,529 |
|
Total Assets |
$ 3,205,278 |
$ 3,065,796 |
|
LIABILITIES AND SHAREHOLDER'S EQUITY |
|||
Current Liabilities: |
|||
Current maturities of long-term debt |
$ 113,932 |
$ 131,069 |
|
Accounts payable |
89,709 |
92,842 |
|
Accounts payable to related parties |
20,813 |
22,074 |
|
Air traffic liability |
282,988 |
297,135 |
|
Taxes and interest payable |
86,495 |
71,223 |
|
Accrued expenses payable |
34,550 |
30,472 |
|
Other current liabilities |
10,362 |
13,845 |
|
Total Current Liabilities |
638,849 |
658,660 |
|
Non-Current Liabilities: |
|||
Long-term debt |
987,375 |
936,657 |
|
Post employment benefits liability |
5,895 |
5,847 |
|
Other long-term liabilities |
48,951 |
44,657 |
|
Deferred tax liabilities |
32,386 |
30,444 |
|
Total Non-Current Liabilities |
1,074,606 |
1,017,605 |
|
Total Liabilities |
1,713,455 |
1,676,265 |
|
Shareholders' Equity: |
|||
Class A - 33,341,822 shares issued and outstanding |
22,496 |
22,495 |
|
Class B - 10,938,125 shares issued and outstanding |
7,466 |
7,466 |
|
Additional paid in capital |
35,575 |
33,567 |
|
Retained earnings |
1,420,324 |
1,324,394 |
|
Accumulated other comprehensive income (loss) |
5,962 |
1,609 |
|
Total Shareholders' Equity |
1,491,823 |
1,389,531 |
|
Total Liabilities and Shareholders' Equity |
$ 3,205,278 |
$ 3,065,796 |
|
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 |
1Q12 |
1Q11 |
4Q11 |
|
Net income as Reported |
$95,930 |
$94,446 |
$104,383 |
|
Special Items (adjustments): |
||||
Unrealized (gain) loss on fuel hedging instruments (1) |
-5,328 |
-12,457 |
-19,069 |
|
Adjusted Net Income |
$90,602 |
$81,989 |
$85,314 |
|
Shares used for Computation (in thousands) |
||||
Basic and Diluted |
44,341 |
44,139 |
44,315 |
|
Adjusted earnings per share - Basic and Diluted |
2.04 |
1.86 |
1.93 |
|
Reconciliation Operating Costs per ASM |
||||
Excluding Fuel and Special Items |
1Q12 |
1Q11 |
4Q11 |
|
Operating Costs per ASM as Reported |
11.3 |
10.3 |
10.9 |
|
Aircraft fuel per ASM |
(4.5) |
(3.7) |
(4.1) |
|
Operating Costs per ASM excluding fuel |
6.8 |
6.5 |
6.9 |
|
FOOTNOTES:
(1) Includes unrealized (gains) losses resulting from the mark-to-market accounting for changes in the fair value of fuel hedging instruments. For 1Q12, 1Q11 and 4Q11, the Company recorded unrealized fuel hedge gains of US$5.3 million, US$12.5 million and US$19.1 million, respectively.
SOURCE Copa Holdings, S.A.
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