SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
Report
of Foreign Issuer
Pursuant
to Rule 13a-16 or 15d-16 of
the
Securities Exchange Act of 1934
Report
on Form 6-K dated for the month of
August, 2009
Copa
Holdings, S.A.
(Translation
of Registrant's Name Into English)
Boulevard
Costa del Este, Avenida Principal y Avenida de la Rotonda
Urbanización
Costa del Este
Complejo
Business Park, Torre Norte
Parque
Lefevre
Panama
City, Panama
(Address
of principal executive offices)
(Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.)
Form
20-F x Form
40-F ¨
(Indicate
by check whether the registrant by furnishing the information contained in this
Form is also thereby furnishing the information to the Commission pursuant to
Rule 12g3-2(b) under the Securities Exchange Act of 1934.)
Yes ¨ No x
(If “Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b);82- )
Enclosure: Press Release -
Copa Holdings Reports
Net Income of US$55.2 Million and EPS of US$1.26 for the Second Quarter of
2009
Copa Holdings Reports Net Income of
US$55.2 Million and EPS of US$1.26 for the Second Quarter of
2009
Excluding
special items, adjusted net income came in at $28.1 million or $0.64 per
share
Panama City, Panama —
August 05, 2009. Copa Holdings, S.A. (NYSE: CPA), parent company of
Copa Airlines and Aero Republica, today announced financial results for the
second quarter of 2009 (2Q09). The terms “Copa Holdings" or "the Company" refer
to the consolidated entity, whose operating subsidiaries are Copa Airlines and
Aero Republica. The following financial and operating information, unless
otherwise indicated, is presented in accordance with U.S.
GAAP. Unless otherwise stated, all comparisons with prior periods
refer to the second quarter of 2008 (2Q08).
OPERATING
AND FINANCIAL HIGHLIGHTS
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·
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Copa
Holdings reported net income of US$55.2 million for 2Q09, or diluted
earnings per share (EPS) of US$1.26, an increase of 81.3% as compared to
net income of US$30.4 million or diluted EPS of US$0.70 in
2Q08.
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·
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Excluding
special items, which for 2Q09 included a US$27.1 million non-cash gain
associated with the mark-to-market of fuel hedge contracts, Copa Holdings
would have reported an adjusted net income of US$28.1 million, or diluted
EPS of $0.64, compared to an adjusted net income of US$24.8 million or EPS
of US$0.57 for 2Q08. See the accompanying reconciliation of
non-GAAP financial information to GAAP financial information included in
the financial tables section of this earnings
release.
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·
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Passenger
traffic for the months of May and June were negatively affected as a
result of the H1N1 flu crisis, which resulted in lower overall demand for
intra-Latin America travel, especially to and from Mexico. The Company
estimates that the H1N1 flu crisis reduced consolidated passenger revenue
by approximately US$12 million.
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·
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Operating
income for 2Q09 came in at US$36.8 million, despite a US$12.8 million
realized fuel hedge loss, representing an increase of 17.8% as compared to
operating income of US$31.2 million for 2Q08, which included a US$7.5
million realized fuel hedge gain. Operating margin increased from 10.5% to
13.2%.
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·
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In
2Q09, total revenues reached US$277.6 million, representing a 6.8%
decline, on a 16.5% capacity expansion. Yield per passenger
mile decreased 13.3% to 15.6 cents and operating revenue per available
seat mile (RASM) decreased 20.0% to 11.4
cents.
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·
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Revenue
passenger miles (RPMs) increased 7.5% from 1.56 billion in 2Q08 to 1.68
billion in 2Q09, and available seat miles (ASMs) increased 16.5% from 2.09
billion in 2Q08 to 2.44 billion in 2Q09, with the Copa Airlines segment
increasing 18.1% year-over-year and Aero Republica increasing
8.9%. Consolidated load factor decreased 5.7 percentage points
to 68.7%. Break-even load factor for 2Q09 decreased 6.7 percentage points
to 59.7% from 66.4% in 2Q08.
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·
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Operating
cost per available seat mile (CASM) decreased 22.5%, from 12.7 cents in
2Q08 to 9.9 cents in 2Q09. CASM, excluding fuel costs,
decreased 9.1% from 7.8 cents in 2Q08 to 7.1 cents in
2Q09.
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·
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Cash,
short term and long term investments ended the quarter at US$394.3
million, representing 31% of the last twelve months’
revenues.
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·
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Copa
Holdings ended the quarter with a consolidated fleet of 58
aircraft. Copa Airlines fleet consisted of 43 aircraft,
including 28 Boeing 737 Next Generation and 15 Embraer-190’s. Aero
Republica’s fleet consisted of 15 aircraft, including 11 Embraer-190’s and
four MD-80’s.
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·
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For
2Q09, Copa Airlines reported on-time performance of approximately 90% and
a flight-completion factor of 99.5%, maintaining its position among the
best in the industry.
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RECENT
DEVELOPMENTS
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·
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On
July 16, Copa Airlines and Boeing announced an order for 13 Boeing 737-800
aircraft, plus options for an additional 8. At Boeing list
prices, the new order will represent a total investment of approximately
US$1 billion. Deliveries of the 13 newly ordered aircraft will begin in
2012 and end in 2015, with the 8 additional options available for delivery
between 2015 and 2017.
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·
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On
July 23, Copa Holdings announced it has obtained final loan guarantee
commitments from the Export-Import Bank of the United States (EX-IM Bank)
to support the purchase and financing of two Boeing 737-800 Next
Generation aircraft scheduled for delivery in 2009, as well as preliminary
commitments for 10 additional aircraft scheduled for delivery between 2010
and 2012.
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Consolidated Financial & Operating
Highlights
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2Q09
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2Q08
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% Change
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1Q08
|
% Change
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||||||||||||||
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RPMs
(millions)
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1,676 | 1,559 | 7.5 | % | 1,807 | -7.3 | % | |||||||||||||
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ASMs
(mm)
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2,438 | 2,093 | 16.5 | % | 2,430 | 0.3 | % | |||||||||||||
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Load
Factor
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68.7 | % | 74.5 | % |
-5.7
|
p.p. | 74.4 | % |
-5.6
|
p.p. | ||||||||||
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Yield
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15.6 | 18.0 | -13.3 | % | 16.2 | -3.7 | % | |||||||||||||
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PRASM
(cents)
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10.7 | 13.4 | -20.0 | % | 12.1 | -11.0 | % | |||||||||||||
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RASM
(cents)
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11.4 | 14.2 | -20.0 | % | 12.7 | -10.4 | % | |||||||||||||
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CASM
(cents)
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9.9 | 12.7 | -22.5 | % | 9.9 | 0.1 | % | |||||||||||||
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CASM
Excl. Fuel (cents)
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7.1 | 7.8 | -9.1 | % | 6.8 | 3.0 | % | |||||||||||||
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Breakeven
Load Factor (2)
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59.7 | % | 66.4 | % | -6.7 | p.p. | 57.5 | % | 2.2 | p.p. | ||||||||||
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Operating
Revenues (US$ mm)
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277.6 | 297.9 | -6.8 | % | 308.8 | -10.1 | % | |||||||||||||
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EBITDAR
(US$ mm)
(1)
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91.2 | 66.7 | 36.6 | % | 111.4 | -18.2 | % | |||||||||||||
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Adjusted
EBITDAR (US$ mm)
(1)(2)
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64.1 | 61.1 | 5.0 | % | 95.3 | -32.7 | % | |||||||||||||
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EBITDAR
Margin (1)
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32.8 | % | 22.4 | % | 10.4 | p.p. | 36.1 | % | -3.3 | p.p. | ||||||||||
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Adjusted
EBITDAR Margin (1)(2)
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23.1 | % | 20.5 | % | 2.6 | p.p. | 30.9 | % | -7.8 | p.p. | ||||||||||
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Operating
Income (US$ mm)
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36.8 | 31.2 | 17.8 | % | 68.9 | -46.7 | % | |||||||||||||
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Operating
Margin
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13.2 | % | 10.5 | % | 2.8 | p.p. | 22.3 | % | -9.1 | p.p. | ||||||||||
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Net
Income (US$ mm)
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55.2 | 30.4 | 81.3 | % | 71.6 | -23.0 | % | |||||||||||||
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Adjusted
Net Income (US$ mm) (2)
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28.1 | 24.8 | 13.5 | % | 55.5 | -49.3 | % | |||||||||||||
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EPS
- Basic (US$)
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1.27 | 0.70 | 80.7 | % | 1.67 | -23.7 | % | |||||||||||||
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Adjusted
EPS - Basic (US$) (2)
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0.65 | 0.58 | 12.6 | % | 1.29 | -49.8 | % | |||||||||||||
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EPS
- Diluted (US$)
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1.26 | 0.70 | 80.4 | % | 1.65 | -23.4 | % | |||||||||||||
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Adjusted
EPS - Diluted (US$)
(2)
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0.64 | 0.57 | 12.8 | % | 1.28 | -49.6 | % | |||||||||||||
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Weighted
Avg. # of Shares - Basic (000)
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43,338 | 43,195 | 0.3 | % | 42,908 | 1.0 | % | |||||||||||||
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Weighted Avg. # of Shares - Diluted
(000)
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43,685 | 43,465 | 0.5 | % | 43,464 | 0.5 | % | |||||||||||||
(1) EBITDAR means earnings before
interest, taxes, depreciation, amortization and rent.
(2) Break-even load factor, adjusted
EBITDAR, Adjusted EBITDAR margin, Adjusted Net Income and Adjusted EPS (Basic
and Diluted) exclude non-cash charges/gains associated with the mark-to-market
of fuel hedges.
Note: A reconciliation
of non-GAAP
financial to the comparable US GAAP measures appears at the end of this press
release.
2
MANAGEMENT’S
COMMENTS ON 2Q09 RESULTS
Copa
Holdings delivered exceptional second quarter results despite being adversely
affected by declining unit revenues as a result of a weaker demand environment,
partly due to the H1N1 flu crisis, which resulted in lower load factors and
yields. For 2Q09 the company reported operating income of US$36.8
million, a 17.8% increase over 2Q08. Operating margin increased 2.8
percentage points from 10.5% to 13.2%, maintaining our position as one of the
most profitable airlines in the world.
Total
revenues decreased 6.8% during the quarter, while capacity increased 16.5%,
which resulted in a 20.0% decrease in revenues per ASM (RASM) from 14.2 cents to
11.4 cents. Passenger revenues, which represented 94% of total
revenues, decreased 6.8% to US$261.7 million, due to a 20.0% decline in
passenger revenue per ASM (PRASM), driven by a 13.3% drop in yield and a 5.7
percentage point decline in consolidated load factor from 74.5% to
68.7%. During the quarter, passenger traffic was negatively affected
as a result of the H1N1 flu crisis, which management estimates had an impact on
consolidated revenue of approximately US$12 million.
In 2Q09,
Copa Airlines’ yields came in at 14.7 cents, representing a decline of 11.9%
compared to 2Q08. Copa Airlines yields declined mainly as a result of
lower average fares as a result of a less robust demand
environment. Aero Republica’s yields decreased 22.5% to 21.2 cents
for the most part due to a weaker Colombian currency.
Consolidated
operating expenses for 2Q09 decreased 9.7% to US$240.9 million, while
consolidated operating expenses per ASM (CASM) decreased 22.5% to 9.9
cents. Excluding fuel costs, unit costs decreased 9.1% to 7.1 cents,
mostly due to lower distribution costs as a result of a lower average commission
rate, in addition to an overall lower revenue base and an increase in direct
sales.
Aircraft
fuel expense decreased 33.9% or US$35.4 million compared to 2Q08, despite a
16.5% increase in available seat miles. The Company’s effective jet
fuel price, which includes a US$12.8 million negative fuel hedge effect in 2Q09
and a US$7.5 million positive fuel hedge effect in 2Q08, decreased from an
average of US$3.47 in 2Q08 to US$2.04 in 2Q09.
For 2Q09,
the Company had fuel hedges in place representing 30% of its consolidated
volume. Continuing with the execution of its fuel hedge policy, the
Company currently has hedged approximately 28% in 3Q09 and 21% in
4Q09. For both 2010 and 2011 the Company has hedged 9% of its
consolidated volume.
The
Company recorded non-operating income of US$21.5 million for 2Q09 compared to
US$2.7 million of non-operating income for 2Q08. Non-operating income
for 2Q09 consisted of a fuel hedge mark-to-market gain of US$27.1 million,
compared to a fuel hedge mark-to-market gain of US$5.7 million in
2Q08.
Copa
Holdings closed the quarter with US$394.3 million in cash, short term and long
term investments, representing approximately 31% of last twelve months´
revenues. Total debt at the end of 2Q09 amounted to
US$948.7 million, most of which relates to aircraft and equipment
financing.
3
For 2Q09,
Aero Republica recorded operating income of US$9.0 million, compared to an
operating loss of US$2.8 million in 2Q08. Operating margin for 2Q09
came in at 15.9%. Aero Republica continues to benefit from its
international expansion and fleet transition strategy aimed at replacing its
MD-80 fleet with modern and fuel-efficient Embraer-190 aircraft. For 2Q09,
Aero Republica’s capacity, in terms of ASMs flown in Embraer-190 aircraft as a
percentage of its total capacity, increased from 52% in 2Q08 to 68% in
2Q09. By the end of 2009, Aero Republica will operate an all
Embraer-190 fleet with an
average age of two years, one of the youngest in the industry.
Additionally,
as part of its international expansion, Aero Republica’s international capacity
reached 23% of total capacity during 2Q09, as compared to 19% in
2Q08. Furthermore, according to reported statistics from Colombia’s
Civil Aeronautics Authority (Aerocivil), Aero Republica’s international
passenger market share for the first five months of 2009 increased to 8%, up
from 5.4% during the same period in 2008.
In 2009,
Copa Airlines’ operational plan calls for capacity growth of approximately 16%,
mostly as a result of the full year effect of capacity introduced during the
course of 2008. At the same time, Aero Republica’s capacity growth will remain
flat or increase slightly as the airline continues its transition to all
Embraer-190 fleet. This should result in a consolidated capacity
growth of approximately 12%. Copa Holdings’ consolidated fleet is
expected to end the year flat at 55 aircraft, made up of 18 737-700s, 11
737-800s and 26 Embraer-190s.
Copa
Holdings continues to deliver industry-leading results, despite negative factors
that continue to affect the industry as a whole. This is the result
of a solid and resilient business model based on developing the most
comprehensive and convenient network for intra Latin America travel and a very
competitive cost structure. Throughout the remainder of 2009, the
Company will seek to continue strengthening its long term competitive position,
with the advantages of a flexible fleet plan and a strong financial
position.
OUTLOOK
FOR 2009
Based on
the Company’s year to date results, and expectations for the remainder of the
year, Copa Holdings’ 2009 operating margin range and capacity guidance remain
unchanged. However, due to a weaker than expected demand environment,
full year consolidated load factor is projected to come in at 72%, down from 76%
in 2008. Additionally, unit revenues (RASM) are now forecasted to
decline approximately 16% from 2008 levels to 12.2 cents. However,
unit costs excluding fuel are also forecasted to come in at 7.2 cents, or
approximately 4% below 2008 levels. We currently estimate an effective full year
2009 jet fuel price of jet fuel, including the effect of current hedge contracts
and into plane costs, of US$2.16 per gallon, up from the previous estimate of
$2.11 per gallon and down from $3.24 in 2008.
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Financial
Outlook
(US
GAAP)
|
2009
- Full Year
Revised
|
2009
- Full Year
Prior
|
2008
Actual
|
|||||||||
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ASMs
(billion)
|
+/-10.0 | +/-10.0 | 8.8 | |||||||||
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Average
Load Factor
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+/-72 | % | +/-74 | % | 76 | % | ||||||
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RASM
(cents)
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+/-12.2 | +/-12.6. | 14.6 | |||||||||
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CASM
Ex-fuel (cents)
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+/- 7.2 | +/- 7.5 | 7.5 | |||||||||
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Operating Margin
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16-18 | % | 16-18 | % | 17.4 | % | ||||||
4
CONSOLIDATED
SECOND QUARTER RESULTS
Operating
revenue
Consolidated
revenue for 2Q09 totaled US$277.6 million, a 6.8% or US$20.3 million
decline from operating revenue of US$297.9 million in 2Q08, mainly due to a
7.5% or US$18.1 million decrease in Copa Airlines’ operating revenue and a 6.4%
or US$3.8 million decline in Aero Republica’s operating revenue.
Copa
Airlines operating revenue
Copa
Airlines operating revenue for 2Q09 totaled US$222.7 million, a 7.5% decline
from operating revenue of US$240.8 million in 2Q08. This decline
was primarily due to a 7.2% or US$16.2 million drop in passenger
revenue.
Passenger
revenue. For 2Q09 passenger
revenue totaled US$209.5 million, a 7.2% decline from passenger revenue of
US$225.7 million in 2Q08 as ASMs increased by 18.1% in 2Q09 as compared to
2Q08. Passenger yield decreased 11.9% to 14.7 cents, while load
factor decreased 8.5 percentage points from 78.3% to 69.9 in 2Q09.
Cargo, mail and
other. Cargo, mail and other
revenue totaled US$13.3 million in 2Q09, a 12.2% decline from cargo, mail and
other of US$15.1 million in 2Q08.
Aero
Republica operating revenue
During
2Q09, Aero Republica generated operating revenue of US$56.4 million,
representing a 6.4% decline from 2Q08. This decrease resulted mainly
from a US$2.9 million or 5.3% decline in passenger revenue. During
the quarter Aero Republica’s capacity (ASMs) increased by 8.9% mainly as a
result of increased international presence, while traffic (RPMs) increased
22.1%, resulting in a load factor of 62.8% or 6.8 percentage point above
2Q08. Yields decreased by 22.5% primarily due to lower fuel
surcharges and a weaker Colombian currency.
Operating
expenses
For 2Q09,
consolidated operating expenses decreased 9.7% to US$240.9 million, representing
operating cost per available seat mile (CASM) of 9.9 cents. Operating
cost per available seat mile (CASM), excluding fuel costs, decreased 9.1% from
7.8 cents in 2Q08 to 7.1 cents in 2Q09. An overview of the major
variances on a consolidated basis follows:
Aircraft
fuel. For
2Q09, aircraft fuel totaled US$68.9 million, a US$35.4 million or 33.9%
decrease from aircraft fuel of US$104.2 million in 2Q08. This decline was
primarily a result of a 41.2% decrease in the average price per gallon of jet
fuel (all-in), which averaged US$2.04 in 2Q09 as compared to US$3.47 in 2Q08,
offset by a 13.8% increase in gallons consumed resulting from increased
capacity. The all-in average price per gallon of jet fuel for 2Q09
includes a US$12.8 million fuel hedge loss.
Salaries and
benefits. For 2Q09, salaries and
benefits totaled US$38.2 million, a 17.4% increase over salaries and
benefits of US$32.6 million in 2Q08. This increase was mostly a result of
an overall increase in operating headcount to support additional
capacity.
Passenger
servicing. For 2Q09, passenger
servicing totaled US$25.1 million, a 7.5% increase over passenger servicing of
US$23.4 million in 2Q08. This increase was primarily a result of an increase in
capacity and passengers carried.
5
Commissions.
For 2Q09, commissions totaled US$12.7 million, a 28.7% decrease from
commissions of US$17.8 million in 2Q08. This decrease was primarily a
result of lower average commission rates at both Copa Airlines and Aero
Republica and a lower revenue base.
Reservations and
sales.
Reservations and sales totaled US$13.1 million, a 9.3% decrease from
reservation and sales of US$14.5 million in 2Q08. This decrease was
primarily a result of lower reservation volume handled through global
distribution systems.
Maintenance,
material and repairs. For 2Q09, maintenance,
material and repairs totaled US$21.6 million, a 33.2% increase over maintenance,
material and repairs of US$16.2 million in 2Q08. This increase was
primarily a result of increased capacity and the timing of major overhaul events
at Copa Airlines.
Depreciation. Depreciation totaled
US$12.0 million in 2Q09, a 14.7% increase over depreciation of
US$10.4 million in 2Q08. This increase was primarily related to the
depreciation of new aircraft and spares.
Flight
operations, aircraft
rentals. landing fees and other rentals. Combined, flight
operations, aircraft rentals, landing fees and other rentals increased 2.3% from
US$33.6 million in 2Q08 to US$34.4 million in 2Q09.
Other. Other expenses totaled
US$14.9 million in 2Q09, an increase of US$0.9 million.
Copa
Airlines operating expenses
Copa
Airlines’ operating expenses decreased 5.7% to US$195.0 million from US$206.8
million in 2Q08, despite an 18.1% increase in capacity. Operating
expenses per available seat mile decreased 20.2% to 9.5 cents in 2Q09 from 11.9
cents in 2Q08. Excluding fuel costs, operating expenses per available
seat mile decreased 7.5% from 7.2 cents in 2Q08 to 6.7 cents in
2Q09.
Aircraft
fuel. For 2Q09,
aircraft fuel totaled US$58.0 million, a 28.8% decrease from aircraft fuel
expense of US$81.5 million in the same period in 2008. This decrease was
primarily a result of a 37.3% decline in the average price per gallon of jet
fuel (all-in), which averaged US$2.12 in 2Q09 as compared to US$3.38 in 2Q08.
The all-in average price per gallon of jet fuel for 2Q09 includes $12.4 million
fuel hedge loss.
Salaries and
benefits. For
2Q09, salaries and benefits totaled US$30.4 million, a 20.8% increase over
salaries and benefits of US$25.1 million in the same period in 2008. This
increase was mainly a result of an overall increase in operating headcount to
support additional capacity.
Passenger
servicing.
Passenger servicing totaled US$21.0 million for 2Q09, an 11.2% increase
over passenger servicing of US$18.9 million in 2Q08. This
increase was primarily the result of an increase in capacity and passengers
carried.
Commissions. Commissions totaled
US$9.3 million for 2Q09, a 34.9% decrease from commissions of US$14.2
million in 2Q08. This decrease was primarily a result of a lower average
commission rate and a lower revenue base
Reservations and
sales.
Reservations and sales totaled US$10.2 million, a 5.0% decrease from
reservation and sales of US$10.8 million in 2Q08. This decrease was
primarily a result of lower reservation volume handled through global
distribution systems.
Maintenance,
materials and repairs.
Maintenance, materials and repairs totaled US$17.9 million in 2Q09, a
69.6% increase over maintenance, materials and repairs of US$10.5 million
in 2Q08. This came mainly as a result of increased capacity and the timing of
major overhaul events.
Depreciation. Depreciation totaled
US$11.0 million in 2Q09, a 20.5% increase over depreciation of
US$9.1 million in 2Q08, primarily related to depreciation of new aircraft
and spare parts.
Flight
operations, aircraft
rentals, landing fees and other rentals. Combined, flight
operations, aircraft rentals, landing fees and other rentals decreased 3.2% from
US$26.6 million in 2Q08 to US$25.7 million in 2Q09.
Other. Other expenses increased
US$1.4 million from US$10.1 million in 2Q08 to US$11.6 million in
2Q09.
6
Aero
Republica operating expenses
Aero
Republica’s operating expenses decreased 24.7% to US$47.5 million in 2Q09 from
US$63.1 million in 2Q08. Operating expenses per available seat mile
(CASM) decreased 30.9% to 12.1 cents in 2Q09 from 17.5 cents in
2Q08. CASM, excluding fuel costs, decreased 16.7% from 11.2 cents in
2Q08 to 9.3 cents in 2Q09, mainly due to less overhaul events and the effect of
a weaker Colombian currency.
Non-operating
income (expense)
Consolidated
non-operating income (expense) totaled a gain of US$21.5 million in 2Q09,
compared to a gain of US$2.7 million in 2Q08.
Interest
expense. Interest expense totaled US$8.5 million in 2Q09, a
13.2% decrease from interest expense of US$9.8 million in 2Q08, primarily as a
result of lower rates on variable rate debt.
Interest
capitalized. Interest capitalized totaled US$0.2 million in
2Q09, a 51.9% decrease from 2Q08.
Interest income. Interest
income totaled US$2.2 million, a 14.8% decrease from interest income of US$2.6
million in 2Q08, mostly a result of lower rates.
Other, net. Other
net totaled a gain of US$27.6 million in 2Q09, mainly related to a US$27.1
million non-cash gain related to the mark-to-market of fuel hedge
contracts.
About
Copa Holdings
Copa
Holdings, through its Copa Airlines and Aero Republica operating subsidiaries,
is a leading Latin American provider of passenger and cargo service. Copa
Airlines currently offers approximately 144 daily scheduled flights to 45
destinations in 24 countries in North, Central and South America and the
Caribbean. In addition, Copa Airlines provides passengers with access to flights
to more than 120 other international destinations through code share agreements
with Continental Airlines and other airlines. Aero Republica, the second-largest
domestic carrier in Colombia, provides service to 12 cities in Colombia as well
as international connectivity with Copa Airlines' Hub of the Americas through
flights from Bogota, Bucaramanga, Cali, Cartagena, Medellin and Pereira.
Additionally, Aero Republica has direct flights to Caracas, Venezuela from the
cities of Bogota and Cartagena.
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.
7
Copa
Holdings, S.A.
Operating
data
|
Unaudited
|
Unaudited
|
%
|
Unaudited
|
%
|
||||||||||||||||
|
2Q09
|
2Q08
|
Change
|
1Q09
|
Change
|
||||||||||||||||
|
Copa
Holdings (Consolidated)
|
||||||||||||||||||||
|
Revenue
passengers carried (thousands)
|
1,270 | 1,168 | 8.7 | % | 1,287 | -1.3 | % | |||||||||||||
|
Revenue
passengers miles (RPMs) (mm)
|
1,676 | 1,559 | 7.5 | % | 1,807 | -7.3 | % | |||||||||||||
|
Available
seat miles (ASMs) (mm)
|
2,438 | 2,093 | 16.5 | % | 2,430 | 0.3 | % | |||||||||||||
|
Load
factor
|
68.7 | % | 74.5 | % | -5.7 | p.p. | 74.4 | % | -5.6 | p.p. | ||||||||||
|
Break-even
load factor
|
0.0 | p.p. | 0.0 | p.p. | ||||||||||||||||
|
Yield
(cents)
|
15.6 | 18.0 | -13.3 | % | 16.2 | -3.7 | % | |||||||||||||
|
RASM
(cents)
|
11.4 | 14.2 | -20.0 | % | 12.7 | -10.4 | % | |||||||||||||
|
CASM
(cents)
|
9.9 | 12.7 | -22.5 | % | 9.9 | 0.1 | % | |||||||||||||
|
CASM
- excl. fuel (cents)
|
7.1 | 7.8 | -9.1 | % | 6.8 | 3.0 | % | |||||||||||||
|
Fuel
gallons consumed (mm)
|
33.7 | 29.7 | 13.8 | % | 33.9 | -0.4 | % | |||||||||||||
|
Average
price of Fuel - Net of Hedges (US$)
|
2.04 | 3.47 | -41.2 | % | 2.16 | -5.5 | % | |||||||||||||
|
Copa
Segment
|
||||||||||||||||||||
|
Revenue
passengers miles (RPMs) (mm)
|
1,429 | 1,357 | 5.3 | % | 1,566 | -8.8 | % | |||||||||||||
|
Available
seat miles (ASMs) (mm)
|
2,045 | 1,732 | 18.1 | % | 2,039 | 0.3 | % | |||||||||||||
|
Load
factor
|
69.9 | % | 78.3 | % | -8.5 | p.p. | 76.8 | % | -6.9 | p.p. | ||||||||||
|
Break-even
load factor
|
0.0 | p.p. | 0.0 | p.p. | ||||||||||||||||
|
Yield
(US$ cents)
|
14.7 | 16.6 | -11.9 | % | 15.5 | -5.4 | % | |||||||||||||
|
RASM
(cents)
|
10.9 | 13.9 | -21.7 | % | 12.6 | -13.2 | % | |||||||||||||
|
CASM
(cents)
|
9.5 | 11.9 | -20.2 | % | 9.5 | 0.5 | % | |||||||||||||
|
CASM
- excl. fuel (cents)
|
6.7 | 7.2 | -7.5 | % | 6.4 | 4.1 | % | |||||||||||||
|
Fuel
gallons consumed (mm)
|
27.3 | 23.7 | 15.5 | % | 27.5 | -0.7 | % | |||||||||||||
|
Average
price of Fuel - Net of Hedges (US$)
|
2.12 | 3.38 | -37.3 | % | 2.25 | -5.7 | % | |||||||||||||
|
Aero
Republica Segment
|
||||||||||||||||||||
|
Revenue
passengers miles (RPMs) (mm)
|
247 | 202 | 22.1 | % | 241 | 2.6 | % | |||||||||||||
|
Available
seat miles (ASMs) (mm)
|
393 | 361 | 8.9 | % | 390 | 0.6 | % | |||||||||||||
|
Load
factor
|
62.8 | % | 62.8 | % | 0.0 | p.p. | 61.6 | % | 1.2 | p.p. | ||||||||||
|
Break-even
load factor
|
0.0 | p.p. | 0.0 | p.p. | ||||||||||||||||
|
Yield
(cents)
|
21.2 | 27.3 | -22.5 | % | 20.9 | 1.1 | % | |||||||||||||
|
RASM
(cents)
|
14.4 | 16.7 | -14.0 | % | 13.8 | 4.4 | % | |||||||||||||
|
CASM
(cents)
|
12.1 | 17.5 | -30.9 | % | 12.1 | -0.5 | % | |||||||||||||
|
CASM
- excl.fuel (cents)
|
9.3 | 11.2 | -16.7 | % | 9.3 | 0.6 | % | |||||||||||||
|
Fuel
gallons consumed (mm)
|
6.4 | 6.0 | 7.0 | % | 6.3 | 0.8 | % | |||||||||||||
|
Average
price of Fuel - Net of Hedges (US$)
|
1.70 | 3.80 | -55.3 | % | 1.77 | -4.2 | % | |||||||||||||
8
Copa
Holdings, S.A.
Income
Statement - USGAAP
(US$
Thousands)
|
Unaudited
|
Unaudited
|
%
|
Unaudited
|
%
|
||||||||||||||||
|
2Q09
|
2Q08
|
Change
|
1Q09
|
Change
|
||||||||||||||||
|
Operating
Revenues
|
||||||||||||||||||||
|
Passenger
Revenue
|
261,743 | 280,919 | -6.8 | % | 293,152 | -10.7 | % | |||||||||||||
|
Cargo,
mail and other
|
15,896 | 17,010 | -6.5 | % | 15,604 | 1.9 | % | |||||||||||||
|
Total
Operating Revenue
|
277,639 | 297,929 | -6.8 | % | 308,756 | -10.1 | % | |||||||||||||
|
Operating
Expenses
|
||||||||||||||||||||
|
Aircraft
fuel
|
68,889 | 104,239 | -33.9 | % | 73,472 | -6.2 | % | |||||||||||||
|
Salaries
and benefits
|
38,223 | 32,553 | 17.4 | % | 36,733 | 4.1 | % | |||||||||||||
|
Passenger
servicing
|
25,129 | 23,375 | 7.5 | % | 26,019 | -3.4 | % | |||||||||||||
|
Commissions
|
12,700 | 17,818 | -28.7 | % | 13,223 | -4.0 | % | |||||||||||||
|
Reservations
and sales
|
13,149 | 14,505 | -9.3 | % | 13,040 | 0.8 | % | |||||||||||||
|
Maintenance,
material and repairs
|
21,559 | 16,180 | 33.2 | % | 16,860 | 27.9 | % | |||||||||||||
|
Depreciation
|
11,966 | 10,433 | 14.7 | % | 11,928 | 0.3 | % | |||||||||||||
|
Flight
operations
|
15,071 | 14,015 | 7.5 | % | 14,935 | 0.9 | % | |||||||||||||
|
Aircraft
rentals
|
11,487 | 12,012 | -4.4 | % | 12,366 | -7.1 | % | |||||||||||||
|
Landing
fees and other rentals
|
7,798 | 7,557 | 3.2 | % | 8,376 | -6.9 | % | |||||||||||||
|
Other
|
14,917 | 14,047 | 6.2 | % | 12,886 | 15.8 | % | |||||||||||||
|
Total
Operating Expense
|
240,888 | 266,734 | -9.7 | % | 239,838 | 0.4 | % | |||||||||||||
|
Operating
Income
|
36,751 | 31,195 | 17.8 | % | 68,918 | -46.7 | % | |||||||||||||
|
Non-operating
Income (Expense):
|
||||||||||||||||||||
|
Interest
expense
|
(8,520 | ) | (9,815 | ) | -13.2 | % | (8,936 | ) | -4.7 | % | ||||||||||
|
Interest
capitalized
|
233 | 484 | -51.9 | % | 318 | -26.7 | % | |||||||||||||
|
Interest
income
|
2,211 | 2,596 | -14.8 | % | 2,563 | -13.7 | % | |||||||||||||
|
Other,
net
|
27,602 | 9,479 | 191.2 | % | 14,394 | 91.8 | % | |||||||||||||
|
Total
Non-Operating Income/(Expense)
|
21,526 | 2,744 | 684.6 | % | 8,339 | 158.2 | % | |||||||||||||
|
Income
before Income Taxes
|
58,277 | 33,938 | 71.7 | % | 77,256 | -24.6 | % | |||||||||||||
|
Provision
for Income Taxes
|
3,115 | 3,507 | -11.2 | % | 5,641 | -44.8 | % | |||||||||||||
|
Net Income
|
55,162 | 30,431 | 81.3 | % | 71,615 | -23.0 | % | |||||||||||||
|
Basic
EPS
|
1.27 | 0.70 | 80.7 | % | 1.67 | -23.7 | % | |||||||||||||
|
Basic
Shares
|
43,337,693 | 43,194,566 | 0.3 | % | 42,907,967 | 1.0 | % | |||||||||||||
|
Diluted
EPS
|
1.26 | 0.70 | 80.4 | % | 1.65 | -23.4 | % | |||||||||||||
|
Diluted
Shares
|
43,684,875 | 43,464,749 | 0.5 | % | 43,463,759 | 0.5 | % | |||||||||||||
9
Copa
Holdings, S.A.
Balance
Sheet - USGAAP
|
(US$
Thousands)
|
June
30,
|
March
31,
|
June
30,
|
|||||||||
|
2009
|
2009
|
2008
|
||||||||||
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||
|
ASSETS
|
||||||||||||
|
Current
Assets:
|
||||||||||||
|
Cash
and cash equivalents
|
$ | 298,479 | $ | 302,905 | $ | 223,505 | ||||||
|
Short-term
investments
|
|
87,544 | 92,568 | 86,500 | ||||||||
|
Total
cash, cash equivalents and short-term investments
|
386,023 | 395,473 | 310,005 | |||||||||
|
Accounts
receivable, net of allowance for doubtful accounts
|
80,035 | 82,021 | 97,525 | |||||||||
|
Accounts
receivable from related parties
|
3,218 | 3,169 | 2,108 | |||||||||
|
Expendable
parts and supplies, net of allowance for obsolescence
|
22,481 | 20,751 | 18,287 | |||||||||
|
Prepaid
expenses
|
27,207 | 23,270 | 23,173 | |||||||||
|
Other
current assets
|
3,835 | 5,419 | 23,395 | |||||||||
|
Total
Current Assets
|
522,799 | 530,103 | 474,493 | |||||||||
|
Long-term
investments
|
8,293 | 7,652 | 17,730 | |||||||||
|
Property
and Equipment:
|
||||||||||||
|
Owned
property and equipment:
|
||||||||||||
|
Flight
equipment
|
1,428,433 | 1,415,590 | 1,300,486 | |||||||||
|
Other
equipment
|
59,728 | 57,109 | 53,263 | |||||||||
| 1,488,161 | 1,472,699 | 1,353,749 | ||||||||||
|
Less:
Accumulated depreciation
|
(198,324 | ) | (186,222 | ) | (155,915 | ) | ||||||
| 1,289,837 | 1,286,477 | 1,197,834 | ||||||||||
|
Purchase
deposits for flight equipment
|
122,364 | 80,674 | 64,567 | |||||||||
|
Total
Property and Equipment
|
1,412,201 | 1,367,151 | 1,262,401 | |||||||||
|
Other
Assets:
|
||||||||||||
|
Net
pension asset
|
1,832 | 1,658 | 1,236 | |||||||||
|
Goodwill
|
22,588 | 19,038 | 25,355 | |||||||||
|
Intangible
asset
|
33,119 | 27,913 | 37,177 | |||||||||
|
Other
assets
|
32,738 | 28,977 | 31,020 | |||||||||
|
Total
Other Assets
|
90,277 | 77,586 | 94,788 | |||||||||
|
Total
Assets
|
$ | 2,033,570 | $ | 1,982,493 | $ | 1,849,412 | ||||||
|
LIABILITIES
AND SHAREHOLDER'S EQUITY
|
||||||||||||
|
Current
Liabilities:
|
||||||||||||
|
Current
maturities of long-term debt
|
$ | 157,040 | $ | 114,741 | $ | 100,454 | ||||||
|
Accounts
payable
|
49,552 | 50,333 | 48,213 | |||||||||
|
Accounts
payable to related parties
|
6,771 | 7,892 | 9,511 | |||||||||
|
Air
traffic liability
|
157,056 | 154,469 | 195,579 | |||||||||
|
Taxes
and interest payable
|
39,346 | 39,746 | 38,208 | |||||||||
|
Accrued
expenses payable
|
39,902 | 37,418 | 44,599 | |||||||||
|
Other
current liabilities
|
20,970 | 46,337 | 4,190 | |||||||||
|
Total
Current Liabilities
|
470,637 | 450,937 | 440,754 | |||||||||
|
Non-Current
Liabilities:
|
||||||||||||
|
Long-term
debt
|
791,612 | 812,124 | 795,820 | |||||||||
|
Post
employment benefits liability
|
2,208 | 2,060 | 1,897 | |||||||||
|
Other
long-term liabilities
|
11,158 | 9,052 | 10,965 | |||||||||
|
Deferred
tax liabilities
|
9,839 | 8,135 | 8,375 | |||||||||
|
Total
Non-Current Liabilities
|
814,817 | 831,371 | 817,057 | |||||||||
|
Total
Liabilities
|
1,285,454 | 1,282,308 | 1,257,811 | |||||||||
|
Shareholders'
Equity:
|
||||||||||||
|
Class
A - 30,416,440 shares issued and outstanding
|
20,858 | 20,858 | 20,761 | |||||||||
|
Class
B - 12,778,125 shares issued and outstanding
|
8,722 | 8,722 | 8,722 | |||||||||
|
Additional
paid in capital
|
16,009 | 14,664 | 11,160 | |||||||||
|
Retained
earnings
|
704,523 | 665,617 | 545,322 | |||||||||
|
Accumulated
other comprehensive income (loss)
|
(1,996 | ) | (9,676 | ) | 5,636 | |||||||
|
Total
Shareholders' Equity
|
748,116 | 700,185 | 591,601 | |||||||||
|
Total
Liabilities and Shareholders' Equity
|
$ | 2,033,570 | $ | 1,982,493 | $ | 1,849,412 | ||||||
10
Copa
Holdings, S.A.
NON-GAAP
FINANCIAL MEASURE RECONCILIATION
This
press release includes the following non GAAP financial measures: Adjusted
EBITDAR, Adjusted Net Income and Adjusted EPS. This
supplemental information is presented because we believe they are useful
indicators of our operating performance and are 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 US GAAP measures, in particular operating income and net income. The
following is a reconciliation of these non-GAAP financial measures to the
comparable US GAAP measures:
|
Reconciliation
of EBITDAR
|
||||||||||||
|
Excluding
Special Items
|
2Q09
|
2Q08
|
1Q09
|
|||||||||
|
Net
income as Reported
|
$ | 55,162 | $ | 30,431 | $ | 71,615 | ||||||
|
Interest
Expense
|
(8,520 | ) | (9,815 | ) | (8,936 | ) | ||||||
|
Capitalized
Interest
|
233 | 484 | 318 | |||||||||
|
Interest
Income
|
2,211 | 2,596 | 2,563 | |||||||||
|
Income
Taxes
|
(3,115 | ) | (3,507 | ) | (5,641 | ) | ||||||
|
EBIT
|
64,353 | 40,674 | 83,311 | |||||||||
|
Depreciation
and Amortization
|
11,966 | 10,433 | 11,928 | |||||||||
|
EBITDA
|
76,319 | 51,107 | 95,239 | |||||||||
|
Aircraft
Rent
|
11,487 | 12,012 | 12,366 | |||||||||
|
Other
Rentals
|
3,345 | 3,610 | 3,812 | |||||||||
|
EBITDAR
|
$ | 91,150 | $ | 66,729 | $ | 111,417 | ||||||
|
Special
Items (adjustments):
|
||||||||||||
|
Unrealized
(gain) loss on fuel hedging instruments (1)
|
(27,069 | ) | (5,679 | ) | (16,163 | ) | ||||||
|
Adjusted
EBITDAR
|
$ | 64,081 | $ | 61,050 | $ | 95,254 | ||||||
11
|
Reconciliation
of Net Income
|
||||||||||||
|
Excluding
Special Items
|
2Q09
|
2Q08
|
1Q09
|
|||||||||
|
Net
income as Reported
|
$ | 55,162 | $ | 30,431 | $ | 71,615 | ||||||
|
Special
Items (adjustments):
|
||||||||||||
|
Unrealized
(gain) loss on fuel hedging instruments (1)
|
(27,069 | ) | (5,679 | ) | (16,163 | ) | ||||||
|
Adjusted
Net Income
|
$ | 28,093 | $ | 24,752 | $ | 55,452 | ||||||
|
Shares
used for Computation (in thousands)
|
||||||||||||
|
Basic
|
43,338 | 43,195 | 42,908 | |||||||||
|
Diluted
|
43,685 | 43,465 | 43,464 | |||||||||
|
Adjusted
earnings per share
|
||||||||||||
|
Basic
|
0.65 | 0.57 | 1.29 | |||||||||
|
Diluted
|
0.64 | 0.57 | 1.28 | |||||||||
FOOTNOTE:
|
(1)
|
The
2Q09, 2Q08 and 1Q09 periods included non-cash gains of US$27.1 million,
US$5.7 million and US$16.2 million, respectively, resulting from the
mark-to-market accounting for changes in the fair value of fuel hedging
instruments.
|
12
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, hereunto
duly authorized.
|
Copa Holdings, S.A.
|
||
|
(Registrant)
|
||
|
Date:
08/5/2009
|
||
|
By:
|
/s/ Victor
Vial
|
|
|
Name:
|
Victor
Vial
|
|
|
Title:
|
CFO
|
|