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, 2010
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 o
|
(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
o
|
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$18.6 Million and EPS of US$0.42 for the Second Quarter
of 2010
Copa
Holdings Reports Net Income of US$18.6 Million and EPS of US$0.42 for the Second
Quarter of 2010
Excluding
special items, adjusted net income came in at $26.3 million, or $0.60 per
share
Panama
City,
Panama --- August 11, 2010. Copa
Holdings, S.A. (NYSE: CPA), parent company of Copa
Airlines and Aero Republica, today announced financial results for the second
quarter of 2010 (2Q10). 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 US
GAAP. See the accompanying reconciliation of non-GAAP financial
information to GAAP financial information included in financial tables section
of this earnings release. Unless otherwise stated, all comparisons with prior
periods refer to the second quarter of 2009 (2Q09).
OPERATING
AND FINANCIAL HIGHLIGHTS
|
·
|
Copa
Holdings reported net income of US$18.6 million for 2Q10, or earnings per
share (EPS) of US$0.42. Excluding special items, Copa Holdings
would have reported an adjusted net income of $26.3 million, or $0.60 per
share, compared to an adjusted net income of US$28.1 million or US$0.64
per share for 2Q09.
|
|
·
|
Operating
income for 2Q10 came in at US$32.5 million, representing an operating
margin of 10.7% compared to an operating margin of 13.2% in
2Q09.
|
|
·
|
In
2Q10, total revenues increased to US$303.4 million, representing growth of
9.3%, on 5.0% capacity expansion. Yield per passenger mile
decreased 2.5% to 15.2 cents mainly as a result of lower fares in
Venezuela and the Colombian domestic market; however, consolidated
operating revenue per available seat mile (RASM) increased 4.1% to 11.9
cents.
|
|
·
|
For
2Q10, consolidated load factor for the quarter increased 4.4 percentage
points to 73.1%, as consolidated passenger traffic grew 11.6% on 5%
capacity increase.
|
|
·
|
Operating
cost per available seat mile (CASM) increased 7.1%, from 9.9 cents in 2Q09
to 10.6 cents in 2Q10. CASM, excluding fuel costs, increased
4.3% from 7.1 cents in 2Q09 to 7.4 cents in 2Q10 mainly as a result of a
stronger Colombian currency and expenses related to additional capacity
mainly to support growth in the second half of
2010.
|
|
·
|
Cash,
short term and long term investments ended 2Q10 at US$359.4 million,
representing 28% of the last twelve months’
revenues.
|
|
·
|
In
May, Copa Airlines took delivery of two Boeing 737-800s ending the quarter
with a consolidated fleet of 60
aircraft.
|
|
·
|
In
June, Copa Airlines increased frequencies to five markets: Sao
Paulo (Brazil), Los Angeles (USA), Guatemala City (Guatemala), Havana
(Cuba) and Punta Cana (Dominican Republic). Also in June, Aero
Republica increased frequencies into Panama City from Bogota and
Medellin. Additionally, as part of its ongoing international
expansion, Aero Republica recently announced that beginning in October it
will launch new service from Bogota to Mexico City and
Havana.
|
|
·
|
For
2Q10, Copa Holdings reported consolidated on-time performance of 91.6% and
a flight-completion factor of 99.7%, maintaining its position among the
best in the industry.
|
|
·
|
On
June 15, 2010, the Company paid its annual dividend which amounted to
$1.09 per share, representing 20% of 2009 consolidated net
income. The dividend was paid to shareholders of record as of
May 31, 2010.
|
| Consolidated
Financial &
Operating
Highlights
|
2Q10
|
2Q09
|
%
Change
|
1Q10
|
%
Change
|
|
RPMs
(mm)
|
1,871
|
1,676
|
11.6
|
2,005
|
-6.7
|
|
ASMs
(mm)
|
2,559
|
2,438
|
5.0
|
2,507
|
2.1
|
|
Load
Factor
|
73.1
|
68.7
|
4.4
p.p.
|
80.0
|
-6.9
p.p.
|
|
Yield
|
15.2
|
15.6
|
-2.5
|
15.9
|
-4.3
|
|
PRASM
(cents)
|
11.1
|
10.7
|
3.7
|
12.7
|
-12.5
|
|
RASM
(cents)
|
11.9
|
11.4
|
4.1
|
13.4
|
-11.3
|
|
CASM
(cents)
|
10.6
|
9.9
|
7.1
|
10.5
|
0.4
|
|
CASM
Excl. Fuel (cents)
|
7.4
|
7.1
|
4.3
|
7.4
|
-0.9
|
|
Breakeven
Load Factor (1)
|
64.9
|
59.7
|
5.2
p.p.
|
62.7
|
2.2
p.p.
|
|
Operating
Revenues (US$ mm)
|
303.4
|
277.6
|
9.3
|
335.2
|
-9.5
|
|
Operating
Income (US$ mm)
|
32.5
|
36.8
|
-11.6
|
70.8
|
-54.2
|
|
Operating
Margin
|
10.7
|
13.2
|
-2.5
p.p.
|
21.1
|
-10.4
p.p.
|
|
Net
Income (US$ mm)
|
18.6
|
55.2
|
-66.3
|
36.7
|
-49.3
|
|
Adjusted
Net Income (US$ mm) (1)
|
26.3
|
28.1
|
-6.6
|
56.9
|
-53.9
|
|
EPS
- Basic and Diluted (US$)
|
0.42
|
1.26
|
-66.3
|
0.84
|
-49.3
|
|
Adjusted
EPS - Basic and Diluted (US$) (1)
|
0.60
|
0.64
|
-6.6
|
1.29
|
-53.9
|
|
# of
Shares - Basic and Diluted (000)
|
43,983
|
43,946
|
0.1
|
43,978
|
0.0
|
(1)
Breakeven Load Factor,
Adjusted Net Income and Adjusted EPS (Basic and Diluted) exclude for 2Q10, 2Q09,
and 1Q10 excludes non-cash charges/gains associated with the mark-to-market of
fuel hedges. Additionally, for 1Q10 Other Special items include a
US$19.8 million charge related to the devaluation of the Venezuelan currency and
for 2Q10 a US$1.0 million gain related to prior period
adjustments.
Note: Attached to this press
release is a reconciliation of non-GAAP financial measures to the comparable US
GAAP measures.
MANAGEMENT’S COMMENTS ON 2Q10
RESULTS
For 2Q10,
Copa Holdings reported operating income of US$32.5 million, which represented an
operating margin of 10.7% or 2.5 percentage points below 2Q09, as unit revenue
gains were offset by higher unit costs, as the Company’s effective fuel price
increased 16% over 2Q09.
Total
revenues increased 9.3% during the quarter on capacity expansion of
5.0%. RASM increased 4.1% from 11.4 cents to 11.9
cents. For the quarter, consolidated load factors increased from
68.7% to 73.1% and yields decreased from 15.6 cents to 15.2 cents.
On a year
over year basis, yields were affected by lower average fares in the Colombian
domestic market. In addition, fares in the Venezuelan market were
affected as a result of the devaluation of the Venezuelan currency in
January. Excluding the aforementioned, consolidated yields would have
increased approximately 5% over 2Q09.
Consolidated
operating expenses for 2Q10 increased 12.5% to US$270.9 million compared to
2Q09, while consolidated CASM increased 7.1% to 10.6 cents during the same
period. Excluding fuel costs, unit costs increased 4.3% to 7.4 cents,
mostly as a result of a stronger Colombian currency and costs related to
capacity expansion in the second half of 2010.
Aircraft
fuel expense, including realized hedge gains or losses, increased 19.9% compared
to 2Q09, The Company’s effective jet fuel price, which includes
a US$0.6 million realized fuel hedge gain in 2Q10 and a US$12.8 million fuel
hedge loss in 2Q09, increased from an average of US$2.04 in 2Q09 to US$2.37 in
2Q10.
2
For 2Q10,
the Company had fuel hedges in place representing 28% of its consolidated
volume. Continuing with the execution of its fuel hedge policy, the
Company currently has hedged approximately 27% in 3Q10 and 22% in
4Q10. For 2011 and 2012, the Company has hedged approximately 25% and
10%, respectively, of its forecasted fuel consumption.
The
Company recorded a net non-operating expense of US$10.4 million for 2Q10
compared to a US$21.5 million non-operating gain in 2Q09. This
expense was mainly due to an unrealized fuel hedge mark-to-market loss of US$8.6
million, as compared to a fuel hedge mark-to-market gain of US$27.1 million in
2Q09.
Copa
Holdings closed the quarter with US$359.4 million in cash, short term and long
term investments, representing approximately 28% of last twelve months´
revenues. Total debt at the end of 2Q10 amounted to US$981.2 million,
most of which relates to aircraft and equipment
financing.
In 2010,
the Company expects to increase its consolidated fleet by seven aircraft and
expand capacity by approximately 10%, with most of this capacity growth derived
from Copa Airlines. Copa Holdings’ consolidated fleet is expected to
end the year at 63 aircraft, composed of 20 Boeing 737-700s, 17 Boeing 737-800s
and 26 Embraer-190s.
Copa
Holdings solid business model and strong competitive advantages continue to
enhance its leadership position in Latin American commercial aviation and have
consistently placed the Company among the most profitable airlines in the
world. Going forward, the Company is well positioned to seize future
growth opportunities and will continue to strengthen what is arguably the most
complete and convenient network for intra-Latin American travel and take
advantage of its superior airport infrastructure.
OUTLOOK FOR 2010
Based on
the Company’s year to date results, and expectations for the remainder of the
year, our RASM guidance is adjusted from 13.1 cents to 12.7 cents, still
expected to come in above 2009 unit revenues. Capacity,
load factor and CASM ex-fuel guidance remain unchanged. However, our
fuel price assumption for full year 2010 has been adjusted from $2.41 to $2.35
per gallon. As a result, our operating margin guidance is adjusted
from a 20-22% range in our previous guidance to a 19-21% range.
|
Financial
Outlook
(US
GAAP)
|
2010 -
Full Year
Revised
|
2010 -
Full Year
Prior
|
2009
Actual
|
|
ASMs
(billion)
|
+/-10.9
|
+/-10.9
|
9.9
|
|
Average Load
Factor
|
+/-77%
|
+/-77%
|
74.6%
|
|
RASM
(cents)
|
+/-12.7
|
+/-13.1
|
12.6
|
|
CASM Ex-fuel
(cents)
|
+/-
7.1
|
+/-
7.1
|
7.2
|
|
Operating
Margin
|
19-21%
|
20-22%
|
19.4%
|
3
CONSOLIDATED SECOND QUARTER
RESULTS
Operating
revenue
Consolidated
revenue for 2Q10 totaled US$303.4 million, a 9.3% or US$25.8 million
increase over operating revenue of US$277.6 million in 2Q09, due to a 14.6%
or US$32.6 million increase in Copa Airlines’ operating revenue, partly offset
by a 9.5% or US$5.4 million decline in Aero Republica’s operating
revenues.
| Copa Airlines operating revenue |
Copa
Airlines operating revenue for 2Q10 totaled US$255.3 million, a 14.6% increase
over operating revenue of US$222.7 million in 2Q09. This
increase was primarily due to a 13.9% or US$29.1 million increase in passenger
revenue.
Passenger
revenue. For 2Q10 passenger
revenue totaled US$238.6 million, a 13.9% increase over passenger revenue
of US$209.5 million in 2Q09. This came as a result of a 1.3%
increase in passenger yield and a 4.4 percentage point increase in load factor,
both contributing to a 7.6% increase in passenger revenue per ASM
(PRASM).
Cargo, mail and
other. Cargo, mail and other
revenue totaled US$16.8 million in 2Q10, a 26.4% increase over cargo, mail and
other of US$13.3 million in 2Q09.
| Aero Republica operating revenue |
During
2Q10, Aero Republica generated operating revenue of US$51.1 million,
representing 9.5% or US$5.4 million decline from 2Q09. The decline in
operating revenue resulted from a US$5.8 million or 11.1% drop in passenger
revenue. During the quarter, Aero Republica’s capacity (ASMs)
increased 0.6%, while traffic (RPMs) increased 7.0%, resulting in a load factor
of 66.8% or 4.0 percentage points above 2Q09. During the same period,
however, passenger yields decreased 16.9%, mainly as a result of a more
competitive environment in the Colombian domestic market, which resulted in an
11.6% decline in PRASM.
Operating
expenses
For 2Q10,
consolidated operating expenses increased 12.5% to US$270.9 million,
representing operating cost per available seat mile (CASM) of 10.6
cents. CASM, excluding fuel costs, increased 4.3% from 7.1 cents in
2Q09 to 7.4 cents in 2Q10. Compared to 1Q09, however, CASM excluding fuel
decreased 0.9%. An overview of the major variances on a consolidated
basis follows:
Aircraft
fuel. For
2Q10, aircraft fuel totaled US$82.6 million, a US$13.7 million or 19.9%
increase over aircraft fuel of US$68.9 million in 2Q09. This increase was
primarily a result of a 16.0% increase in the average price per gallon of jet
fuel (including into plane costs and realized hedges), which averaged US$2.37 in
2Q10, as compared to US$2.04 in 2Q09, and a 3.2% increase in gallons consumed
resulting from increased capacity. This average price per gallon of
jet fuel for 2Q10 includes a $0.6 million fuel hedge gain, compared to a US$12.8
fuel hedge loss in 2Q09. Excluding the effect of fuel hedge gains and losses for
both periods fuel prices increased 42.5%, from US$1.66 per gallon in 2Q09 to
US$2.38 in 2Q10.
Salaries and
benefits. For 2Q10, salaries and
benefits totaled US$43.0 million, a 12.4% increase over salaries and
benefits of US$38.2 million in 2Q09. This increase was mostly a result of a
stronger Colombian currency and an overall increase in operating headcount to
support additional capacity to be deployed during the second half of
2010.
4
Passenger
servicing. For 2Q10, passenger
servicing totaled US$28.2 million, a 12.4% increase over passenger servicing of
US$25.1 million in 2Q09. This increase was primarily a result of an increase in
passengers carried.
Commissions.
For 2Q10, commissions totaled US$12.2 million, a 4.3% decline from
commissions of US$12.7 million in 2Q09. This decline resulted from a lower
average commission rate, offset by a higher passenger revenue base.
Reservations and
sales.
Reservations and sales totaled US$13.5 million, a 2.3% increase over
reservation and sales of US$13.1 million in 2Q09. This increase was primarily a
result of more passengers carried, partially offset by lower average global
distribution system rates.
Maintenance,
material and repairs. For 2Q10, maintenance,
material and repairs totaled US$23.7 million, a 9.9% increase over maintenance,
material and repairs of US$21.6 million in 2Q09. This increase was
primarily a result of more departures and the timing of certain
events.
Depreciation. Depreciation totaled
US$13.2 million in 2Q10, a 10.3% increase over depreciation of
US$12.0 million in 2Q09. This increase was primarily driven by the
depreciation of additional aircraft and spares.
Flight
operations, aircraft
rentals, landing fees and other rentals. Combined, flight
operations, aircraft rentals, landing fees and other rentals increased 9.9% from
US$34.4 million in 2Q09 to US$37.8 million in 2Q10, primarily as a
result of increased capacity.
Other. Other expenses totaled
US$16.8 million in 2Q10, reflecting an increase of US$1.9 million.
| Copa Airlines operating expenses |
Copa
Airlines’ operating expenses increased 10.5% to US$215.5 million from US$195.0
million in 2Q09. Operating expenses per available seat mile increased
4.4% to 10.0 cents in 2Q10 from 9.5 cents in 2Q09. Excluding fuel
costs, operating expenses per available seat mile increased 2.7% from 6.7 cents
in 2Q09 to 6.9 cents in 2Q10.
Aircraft
fuel. For
2Q10, aircraft fuel totaled US$66.6 million, a 14.9% increase over aircraft
fuel of US$58.0 million in 2Q09. This increase was primarily a result of a 10.2%
increase in the average price per gallon of jet fuel (including into plane costs
and realized hedges), which averaged US$2.34 in 2Q10 as compared to US$2.12 in
2Q09, and a 4.1% increase in gallons consumed resulting from increased
capacity. This average price per gallon of jet fuel for 2Q10 includes
a $0.5 million fuel hedge gain compared to a US$12.4 fuel hedge loss in
2Q09. Excluding the effect of fuel hedge gains and losses for 2Q10
and 2Q09, fuel prices increased 41.3% from US$1.67 per gallon in 2Q09 to US$2.35
in 2Q10.
Salaries and
benefits. For
2Q10, salaries and benefits totaled US$33.6 million, a 10.6% increase over
salaries and benefits of US$30.4 million in the same period in 2009. This
increase was mainly a result of an overall increase in operating headcount to
support capacity expansion during the second half of 2010.
Passenger
servicing.
Passenger servicing totaled US$23.2 million for 2Q10, a 10.5% increase
over passenger servicing of US$21.0 million in 2Q09. This
increase was primarily the result of an increase in passengers
carried.
Commissions. Commissions totaled
US$10.7 million for 2Q10, a 15.5% increase over commissions of US$9.3
million in 2Q09. This increase was primarily a result of a higher passenger
revenue base.
Reservations and
sales.
Reservations and sales totaled US$9.7 million, a 5.3% decrease over
reservation and sales of US$10.2 million in 2Q09. This decrease was primarily a
result of lower average global distribution system rates.
Maintenance,
materials and repairs.
Maintenance, materials and repairs totaled US$20.0 million in 2Q10,
a 12.0% increase over maintenance, materials and repairs of US$17.9 million
in 2Q09. This increase resulted from increased capacity and the timing of
certain events.
5
Depreciation. Depreciation totaled
US$11.5 million in 2Q10, a 4.8% increase over depreciation of
US$11.0 million in 2Q09. This increase was primarily driven by
the depreciation of additional aircraft and spares.
Flight
operations, aircraft
rentals, landing fees and other rentals. Combined, flight
operations, aircraft rentals, landing fees and other rentals increased 8.5% from
US$25.7 million in 2Q09 to US$27.9 million in 2Q10, primarily as a result
of additional capacity.
Other. Other expenses increased
US$0.7 million from US$11.6 million in 2Q09 to US$12.3 million in
2Q10.
| Aero Republica operating expenses |
Aero
Republica’s operating expenses increased 24.6% to US$59.1 million in 2Q10 from
US$47.5 million in 2Q09. Operating expenses per available seat mile
(CASM) increased 23.9% to 15.0 cents in 2Q10 from 12.1 cents in
2Q09. CASM, excluding fuel costs, increased 17.3% from 9.3 cents in
2Q09 to 10.9 cents in 2Q10, mainly due to the strength of the Colombian currency
and higher passenger related expenses.
Non-operating
income (expense)
Consolidated
non-operating income (expense) totaled a loss of US$10.4 million in 2Q10,
compared to a US$21.5 million gain in 2Q09.
Interest
expense. Interest expense totaled US$7.5 million in 2Q10, a
12.2% decrease from interest expense of US$8.5 million in 2Q09, primarily as a
result of lower rates on variable rate debt.
Interest income. Interest
income totaled US$1.1 million, a 48.0% decline from interest income of US$2.2
million in 2Q09, mostly as a result of lower interest rates.
Other, net. Other
net totaled a loss of US$4.1 million in 2Q10, mainly related to a US$8.6 million
non-cash charge 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 152 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 daily flights to Caracas, Venezuela from
the cities of Bogota and Medellin.
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.
6
|
Copa Holdings,
S.A.
|
|||||
|
Operating
data
|
|||||
|
Unaudited
|
Unaudited
|
%
|
Unaudited
|
%
|
|
|
2Q10
|
2Q09
|
Change
|
1Q10
|
Change
|
|
|
Copa Holdings
(Consolidated)
|
|||||
|
Revenue passengers carried
(thousands)
|
1,430
|
1,270
|
12.6%
|
1,491
|
-4.1%
|
|
Revenue passengers miles (RPMs)
(mm)
|
1,871
|
1,676
|
11.7%
|
2,005
|
-6.7%
|
|
Available seat miles (ASMs)
(mm)
|
2,559
|
2,438
|
5.0%
|
2,507
|
2.1%
|
|
Load factor
|
73.1%
|
68.7%
|
4.4 p.p.
|
80.0%
|
-6.9
p.p.
|
|
Break-even load
factor
|
64.9%
|
59.7%
|
5.2 p.p.
|
62.7%
|
2.2 p.p.
|
|
Yield
(cents)
|
15.2
|
15.6
|
-2.5%
|
15.9
|
-4.3%
|
|
RASM
(cents)
|
11.9
|
11.4
|
4.1%
|
13.4
|
-11.3%
|
|
CASM
(cents)
|
10.6
|
9.9
|
7.1%
|
10.5
|
0.4%
|
|
CASM - excl. fuel
(cents)
|
7.4
|
7.1
|
4.3%
|
7.4
|
-0.9%
|
|
Fuel gallons consumed
(mm)
|
34.8
|
33.7
|
3.2%
|
34.6
|
0.6%
|
|
Average price of Fuel - Net of
Hedges (US$)
|
2.37
|
2.04
|
16.0%
|
2.26
|
4.8%
|
|
Copa
Segment
|
|||||
|
Revenue passengers miles (RPMs)
(mm)
|
1,607
|
1,429
|
12.5%
|
1,723
|
-6.7%
|
|
Available seat miles (ASMs)
(mm)
|
2,164
|
2,045
|
5.8%
|
2,108
|
2.7%
|
|
Load factor
|
74.2%
|
69.9%
|
4.4 p.p.
|
81.7%
|
-7.5
p.p.
|
|
Break-even load
factor
|
61.3%
|
60.8%
|
0.5 p.p.
|
60.0%
|
1.3 p.p.
|
|
Yield (US$
cents)
|
14.8
|
14.7
|
1.3%
|
15.4
|
-3.4%
|
|
RASM
(cents)
|
11.8
|
10.9
|
8.3%
|
13.3
|
-11.0%
|
|
CASM
(cents)
|
10.0
|
9.5
|
4.4%
|
9.9
|
0.5%
|
|
CASM - excl. fuel
(cents)
|
6.9
|
6.7
|
2.7%
|
6.9
|
-0.7%
|
|
Fuel gallons consumed
(mm)
|
28.4
|
27.3
|
4.1%
|
28.2
|
0.8%
|
|
Average price of Fuel - Net of
Hedges (US$)
|
2.34
|
2.12
|
10.2%
|
2.23
|
4.7%
|
|
Aero Republica
Segment
|
|||||
|
Revenue passengers miles (RPMs)
(mm)
|
264
|
247
|
7.0%
|
282
|
-6.3%
|
|
Available seat miles (ASMs)
(mm)
|
395
|
393
|
0.6%
|
399
|
-1.0%
|
|
Load factor
|
66.8%
|
62.8%
|
4.0 p.p.
|
70.5%
|
-3.7
p.p.
|
|
Break-even load
factor
|
82.5%
|
60.8%
|
21.7 p.p.
|
73.7%
|
8.8 p.p.
|
|
Yield
(cents)
|
17.6
|
21.2
|
-16.9%
|
19.3
|
-8.6%
|
|
RASM
(cents)
|
12.9
|
14.4
|
-10.0%
|
14.7
|
-12.3%
|
|
CASM
(cents)
|
15.0
|
12.1
|
23.9%
|
14.9
|
0.7%
|
|
CASM - excl. fuel
(cents)
|
10.9
|
9.3
|
17.3%
|
11.0
|
-1.0%
|
|
Fuel gallons consumed
(mm)
|
6.4
|
6.4
|
-0.5%
|
6.4
|
-0.6%
|
|
Average price of Fuel - Net of
Hedges (US$)
|
2.51
|
1.70
|
47.5%
|
2.38
|
5.3%
|
7
|
Copa Holdings,
S.A.
|
|||||||||
|
Income Statement -
USGAAP
|
|||||||||
|
(US$
Thousands)
|
|
Unaudited
|
Unaudited
|
%
|
Unaudited
|
%
|
|||||
|
2Q10
|
2Q09
|
Change
|
1Q10
|
Change
|
|||||
|
Operating
Revenues
|
|||||||||
|
Passenger
Revenue
|
285,019
|
261,743
|
8.9%
|
319,062
|
-10.7%
|
||||
|
Cargo, mail and
other
|
18,382
|
15,896
|
15.6%
|
16,129
|
14.0%
|
||||
|
Total Operating
Revenue
|
303,401
|
277,639
|
9.3%
|
335,191
|
-9.5%
|
||||
|
Operating
Expenses
|
|||||||||
|
Aircraft
fuel
|
82,613
|
68,889
|
19.9%
|
78,155
|
5.7%
|
||||
|
Salaries and
benefits
|
42,970
|
38,223
|
12.4%
|
42,490
|
1.1%
|
||||
|
Passenger
servicing
|
28,239
|
25,129
|
12.4%
|
29,432
|
-4.1%
|
||||
|
Commissions
|
12,160
|
12,700
|
-4.3%
|
13,777
|
-11.7%
|
||||
|
Reservations and
sales
|
13,453
|
13,149
|
2.3%
|
14,149
|
-4.9%
|
||||
|
Maintenance, material and
repairs
|
23,697
|
21,559
|
9.9%
|
20,241
|
17.1%
|
||||
|
Depreciation
|
13,203
|
11,966
|
10.3%
|
12,627
|
4.6%
|
||||
|
Flight
operations
|
16,492
|
15,071
|
9.4%
|
15,942
|
3.5%
|
||||
|
Aircraft
rentals
|
11,189
|
11,487
|
-2.6%
|
12,069
|
-7.3%
|
||||
|
Landing fees and other
rentals
|
10,080
|
7,798
|
29.3%
|
9,326
|
8.1%
|
||||
|
Other
|
16,833
|
14,917
|
12.8%
|
16,157
|
4.2%
|
||||
|
Total Operating
Expense
|
270,929
|
240,888
|
12.5%
|
264,365
|
2.5%
|
||||
|
Operating
Income
|
32,473
|
36,751
|
-11.6%
|
70,826
|
-54.2%
|
||||
|
Non-operating Income
(Expense):
|
|||||||||
|
Interest
expense
|
(7,482)
|
(8,520)
|
-12.2%
|
(7,072)
|
5.8%
|
||||
|
Interest
capitalized
|
0
|
233
|
-100.0%
|
0
|
-
|
||||
|
Interest
income
|
1,149
|
2,211
|
-48.0%
|
1,296
|
-11.3%
|
||||
|
Other, net
|
(4,101)
|
27,602
|
-114.9%
|
(21,393)
|
-80.8%
|
||||
|
Total Non-Operating
Income/(Expense)
|
(10,434)
|
21,526
|
-148.5%
|
(27,169)
|
-61.6%
|
||||
|
Income before Income
Taxes
|
22,039
|
58,277
|
-62.2%
|
43,657
|
-49.5%
|
||||
|
Provision for Income
Taxes
|
3,425
|
3,115
|
10.0%
|
6,931
|
-50.6%
|
||||
|
Net Income
|
18,614
|
55,162
|
-66.3%
|
36,726
|
-49.3%
|
|
EPS - Basic and
Diluted
|
0.42
|
1.26
|
-66.3%
|
0.84
|
-49.3%
|
||||
|
Shares - Basic and
Diluted
|
43,982,983
|
43,946,321
|
0.1%
|
43,977,696
|
0.0%
|
8
|
Copa Holdings,
S.A.
|
||||||||||||
|
Balance Sheet -
USGAAP
|
||||||||||||
|
(US$
Thousands)
|
June 30,
|
March 31,
|
June 30,
|
|||||||||
|
2010
|
2010
|
2009
|
||||||||||
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||
|
ASSETS
|
||||||||||||
|
Current
Assets:
|
||||||||||||
|
Cash and cash
equivalents
|
$ | 197,557 | $ | 257,610 | $ | 298,479 | ||||||
|
Short-term
investments
|
155,663 | 97,038 | 87,544 | |||||||||
|
Total cash, cash equivalents and
short-term investments
|
353,220 | 354,648 | 386,023 | |||||||||
|
Accounts receivable, net of
allowance for doubtful accounts
|
99,762 | 90,386 | 80,035 | |||||||||
|
Accounts receivable from related
parties
|
2,431 | 2,140 | 3,218 | |||||||||
|
Expendable parts and supplies, net
of allowance for obsolescence
|
27,750 | 26,228 | 22,481 | |||||||||
|
Prepaid
expenses
|
31,331 | 29,254 | 27,207 | |||||||||
|
Other current
assets
|
5,769 | 12,921 | 3,835 | |||||||||
|
Total Current
Assets
|
520,263 | 515,577 | 522,799 | |||||||||
|
Long-term
investments
|
6,145 | 6,429 | 8,293 | |||||||||
|
Property and
Equipment:
|
||||||||||||
|
Owned property and
equipment:
|
||||||||||||
|
Flight
equipment
|
1,623,718 | 1,525,904 | 1,428,433 | |||||||||
|
Other
equipment
|
64,678 | 63,310 | 59,728 | |||||||||
| 1,688,396 | 1,589,214 | 1,488,161 | ||||||||||
|
Less: Accumulated
depreciation
|
(243,524 | ) | (230,524 | ) | (198,324 | ) | ||||||
| 1,444,872 | 1,358,690 | 1,289,837 | ||||||||||
|
Purchase deposits for flight
equipment
|
164,551 | 175,699 | 122,364 | |||||||||
|
Total Property and
Equipment
|
1,609,423 | 1,534,389 | 1,412,201 | |||||||||
|
Other
Assets:
|
||||||||||||
|
Net pension
asset
|
2,022 | 1,844 | 1,832 | |||||||||
|
Goodwill
|
25,442 | 25,282 | 22,588 | |||||||||
|
Intangible
asset
|
37,304 | 37,070 | 33,119 | |||||||||
|
Other
assets
|
39,911 | 41,630 | 32,738 | |||||||||
|
Total Other
Assets
|
104,679 | 105,826 | 90,277 | |||||||||
|
Total
Assets
|
$ | 2,240,510 | $ | 2,162,221 | $ | 2,033,570 | ||||||
|
LIABILITIES AND SHAREHOLDER'S
EQUITY
|
||||||||||||
|
Current
Liabilities:
|
||||||||||||
|
Current maturities of long-term
debt
|
$ | 145,085 | $ | 113,792 | $ | 157,040 | ||||||
|
Accounts
payable
|
47,840 | 45,823 | 49,552 | |||||||||
|
Accounts payable to related
parties
|
7,415 | 9,693 | 6,771 | |||||||||
|
Air traffic
liability
|
193,831 | 164,105 | 157,056 | |||||||||
|
Taxes and interest
payable
|
46,112 | 46,167 | 39,346 | |||||||||
|
Accrued expenses
payable
|
42,332 | 42,712 | 39,902 | |||||||||
|
Other current
liabilities
|
13,134 | 9,501 | 20,970 | |||||||||
|
Total Current
Liabilities
|
495,749 | 431,792 | 470,637 | |||||||||
|
Non-Current
Liabilities:
|
||||||||||||
|
Long-term
debt
|
836,116 | 793,157 | 791,612 | |||||||||
|
Post employment benefits
liability
|
2,630 | 2,590 | 2,208 | |||||||||
|
Other long-term
liabilities
|
14,748 | 14,314 | 11,158 | |||||||||
|
Deferred tax
liabilities
|
14,131 | 14,056 | 9,839 | |||||||||
|
Total Non-Current
Liabilities
|
867,625 | 824,117 | 814,817 | |||||||||
|
Total
Liabilities
|
1,363,373 | 1,255,909 | 1,285,454 | |||||||||
|
Shareholders'
Equity:
|
||||||||||||
|
Class A - 32,656,660 shares issued
and outstanding
|
22,291 | 22,291 | 20,858 | |||||||||
|
Class B - 10,938,125 shares issued
and outstanding
|
7,466 | 7,466 | 8,722 | |||||||||
|
Additional paid in
capital
|
21,283 | 19,904 | 16,009 | |||||||||
|
Retained
earnings
|
825,944 | 855,238 | 704,523 | |||||||||
|
Accumulated other comprehensive
income (loss)
|
153 | 1,411 | (1,996 | ) | ||||||||
|
Total Shareholders'
Equity
|
877,137 | 906,310 | 748,116 | |||||||||
|
Total Liabilities and
Shareholders' Equity
|
$ | 2,240,510 | $ | 2,162,219 | $ | 2,033,570 | ||||||
9
NON-GAAP
FINANCIAL MEASURE RECONCILIATION
This
press release includes the following non GAAP financial measures: Adjusted CASM,
Adjusted CASM Excluding Fuel, Adjusted Operating Income, 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 U.S. GAAP measures, in particular operating
income and net income. The following is a reconciliation of these non-GAAP
financial measures to the comparable U.S. GAAP measures:
|
Reconciliation
of Net Income
|
||||||||||||
|
Excluding
Special Items
|
2Q10
|
2Q09
|
1Q10
|
|||||||||
|
Net
income as Reported
|
$ | 18,614 | $ | 55,162 | $ | 36,726 | ||||||
|
Special
Items (adjustments):
|
||||||||||||
|
Unrealized
(gain) loss on fuel hedging instruments (1)
|
8,602 | (27,069 | 372 | |||||||||
|
Other special items, net
(2)
|
(965) | - | 19,828 | |||||||||
|
Adjusted
Net Income
|
$ | 26,251 | $ | 28,093 | $ | 56,926 | ||||||
|
Shares
used for Computation (in thousands)
|
43,983 | 43,946 | 43,978 | |||||||||
|
Adjusted
EPS
|
0.60 | 0.64 | 1.29 | |||||||||
|
Reconciliation
Operating Costs per ASM
|
||||||||||||
|
Excluding
Fuel and Special Items
|
2Q10
|
2Q09
|
1Q10
|
|||||||||
|
Operating
Costs per ASM as Reported
|
10.6
|
9.9 | 10.5 | |||||||||
|
Aircraft
fuel per ASM
|
(3.2)
|
(2.8)
|
(3.1)
|
|||||||||
|
Operating
Costs per ASM excluding fuel
|
7.4 | 7.1 | 7.4 | |||||||||
FOOTNOTES:
|
(1)
|
Includes
unrealized (gains) losses resulting from the mark-to-market accounting for
changes in the fair value of fuel hedging instruments. For 2Q10
and 1Q10 the Company recorded unrealized fuel hedge losses of US$8.6
million and US$0.4 million, respectively. For 2Q09 the Company
recorded an unrealized fuel hedge gain of US$27.1
million.
|
|
(2)
|
Other
Special items include for 1Q10 a US$19.8 million charge related to the
devaluation of the Venezuelan currency and for 2Q10 a US$1.0 million gain
related to prior period
adjustments.
|
10
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:
8/11/2010
|
|||
|
By:
|
/s/ Victor Vial
|
||
|
Name:
|
Victor
Vial
|
||
|
Title:
|
CFO
|
||