Washington, D.C. 20549






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 May, 2015



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


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: 1Q15 Earnings Release






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.
 Date: 5/6/2015    
  By:  /s/ José Montero  

Name: José Montero

Title: CFO








 Exhibit 99.1




Copa Holdings Reports Net Income of US$113.1 Million and EPS of US$2.57 for the First Quarter of 2015

Excluding special items, adjusted net income came in at US$106.0 million, or EPS of US$2.41 per share


Panama City, Panama — May 6, 2015. Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the first quarter of 2015(1Q15). 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 2014 (1Q14).




§Copa Holdings reported net income of US$113.1 million for 1Q15, or diluted earnings per share (EPS) of US$2.57. Excluding special items, Copa Holdings would have reported an adjusted net income of US$106.0 million, or EPS of US$2.41 per share, a 30.4% decrease over adjusted net income of US$153.6 million and US$3.46 per share for 1Q14.
§Operating income for 1Q15 came in at US$127.3 million, a 28.1% decrease over operating income of US$177.0 million in 1Q14. Operating margin for the period came in at 20.1%, compared to 24.8% in 1Q14, as a result of lower unit revenues partially offset by lower unit costs.
§Total revenues decreased 11.5% to US$631.8 million. Yield per passenger mile decreased 16.2% to 14.8 cents and operating revenue per available seat mile (RASM) decreased 18.3% to 11.6 cents. Adjusting for an 8.5% increase in length of haul, yields and RASM decreased 12.7% and 14.9%, respectively.
§For 1Q14, passenger traffic (RPMs) grew 5.8% on a 8.3% capacity expansion. Consolidated load factor came in at 76.3%, 1.8 percentage points below 1Q14.
§Operating cost per available seat mile (CASM) decreased 13.2%, from 10.7 cents in 1Q14 to 9.3 cents in 1Q15 mainly due to lower jet fuel costs. CASM, excluding fuel, decreased 3.4% to 6.3 cents mainly due to lower sales related expenses and lower overhead expenses.
§Cash, short-term and long-term investments ended 1Q15 at US$1.16 billion, representing 44% of the last twelve months’ revenues. Of this amount, 41% or US$470.1 million was in Venezuela pending repatriation due to government currency controls.
§During the first quarter, Copa Airlines took delivery of one Boeing 737-800 aircraft, and returned a leased Boeing 737-700. As a result, Copa Holdings ended the quarter with a consolidated fleet of 98 aircraft.
§For 1Q15, Copa Holdings reported consolidated on-time performance of 90.0% and a flight-completion factor of 99.5%, maintaining its position among the best in the industry.


Subsequent Events


§On April 10, 2015, Copa Holdings signed an order with Boeing to purchase 61 737-MAX aircraft, worth US$6.6 billion at Boeing list prices. The aircraft are expected to be delivered between 2018 and 2024.
§On June 15, 2015, Copa Holdings will pay its second quarter dividend of US$0.84 per share, on all outstanding Class A and Class B shares, to stockholders of record as of May 29, 2015.







Consolidated Financial &
Operating Highlights
   1Q15   1Q14   % Change     4Q14   % Change  
Revenue Passengers Carried ('000)   1,965    2,032    -3.3%   1,952    0.6%
RPMs (mm)   4,143    3,917    5.8%   4,036    2.7%
ASMs (mm)   5,433    5,015    8.3%   5,377    1.0%
Load Factor   76.3%   78.1%   -1.8 p.p.   75.1%   1.2 p.p.
Yield   14.8    17.7    -16.2%   16.1    -8.0%
PRASM (US$ Cents)   11.3    13.8    -18.2%   12.1    -6.5%
RASM (US$ Cents)   11.6    14.2    -18.3%   12.5    -6.8%
CASM (US$ Cents)   9.3    10.7    -13.2%   10.3    -9.5%
CASM Excl. Fuel (US$ Cents)   6.3    6.6    -3.4%   6.7    -4.9%
Breakeven Load Factor (1)   60.0%   57.6%   2.4 p.p.   57.5%   2.5 p.p.
Fuel Gallons Consumed (Millions)   69.6    65.3    6.6%   69.1    0.8%
Avg. Price Per Fuel Gallon (US$ Dollars)   2.31    3.19    -27.5%   2.81    -17.9%
Average Length of Haul (Miles)   2,109    1,944    8.5%   2,067    2.0%
Average Stage Length (Miles)   1,247    1,173    6.3%   1,234    1.1%
Departures   30,603    30,546    0.2%   30,676    -0.2%
Block Hours   97,530    91,569    6.5%   97,399    0.1%
Average Aircraft Utilization (Hours)   11.1    11.3    -2.2%   10.8    2.0%
Operating Revenues (US$ mm)   631.8    713.6    -11.5%   670.9    -5.8%
Operating Income (US$ mm)   127.3    177.0    -28.1%   118.8    7.1%
Operating Margin   20.1%   24.8%   -4.7 p.p.   17.7%   2.4 p.p.
Net Income (US$ mm)   113.1    151.4    -25.3%   35.9    214.9%
Adjusted Net Income (US$ mm) (1)   106.0    153.6    -30.9%   125.3    -15.4%
EPS - Basic and Diluted (US$)   2.57    3.41    -24.7%   0.81    216.9%
Adjusted EPS - Basic and Diluted (US$) (1)   2.41    3.46    -30.4%   2.83    -14.9%
# of Shares - Basic and Diluted ('000)   44,077    44,403    -0.7%   44,355    -0.6%


(1) Breakeven Load Factor, Adjusted Net Income and Adjusted EPS for 1Q15, 1Q14, and 4Q14 exclude non-cash charges/gains associated with the mark-to-market of fuel hedges, and the impact of the Venezuelan currency devaluation.

Note: Attached to this press release is a reconciliation of non-IFRS financial measures to the comparable IFRS measures.








Copa Holdings’ first quarter results reflect lower passenger yields driven in large part by the reduction in Venezuelan yields from the transition to all US dollar ticket sales, as well as demand weakness in other markets, particularly in South America, which were partially offset by a lower fuel expense and lower ex-fuel unit costs for the quarter.


Total revenues decreased 11.5% to US$631.8 million during the quarter on capacity growth of 8.3%. Load factor came in at 76.3%, or 1.8 percentage points below 1Q14, while yields decreased 16.2% to 14.8 cents. As a result, passenger revenues per ASM (PRASM) decreased 18.2%, from 13.8 cents in 1Q14 to 11.3 cents in 1Q15. When adjusting for an 8.5% increase in length of haul, PRASM decreased 14.8% from 1Q14.


Consolidated operating expenses for 1Q15 decreased 6.0% to US$504.6 million, while consolidated operating expenses per ASM (CASM) decreased 13.2% to 9.3 cents. Excluding fuel costs, unit costs decreased 3.4% to 6.3 cents, mainly as a result of lower sales related expenses and lower overhead expenses.


Aircraft fuel expense decreased 22.7% or US$47.2 million compared to 1Q14, mostly as a result of lower fuel prices partially offset by increased capacity. The Company’s effective jet fuel price, which includes a realized hedge loss of US$25.7 million in 1Q15 and a gain of US$2.8 million in 1Q14, decreased from an average of US$3.19 in 1Q14 to US$2.31 in 1Q15. 


For 1Q15, the Company had fuel hedges in place representing 32% of its consolidated volume. The Company has already hedged approximately 30% of its projected volume for 2Q15, 25% in 3Q15 and 20% in 4Q15. For 2016, the Company has hedged approximately 21% of its forecasted fuel consumption.


The Company recorded a net non-operating income of US$0.8 million for 1Q15 compared to a net non-operating expense of US$3.3 million for 1Q14. For 1Q15, non-operating income (expense) included a fuel hedge mark-to-market gain of US$7.1 million compared to a fuel hedge mark-to-market loss of US$3.4 million for 1Q14, and a US$3.3 million loss due to transactional and translational foreign currency devaluation by the end of the quarter, compared to a US$1.2 million gain related to appreciation of the Venezuelan Bolivar SICAD 1 rate in 1Q14.


Copa Holdings closed the quarter with US$1.16 billion in cash, short-term and long-term investments, representing 44% of the last twelve months´ revenues. Of such cash, US$470.1 million is subject to exchange controls in Venezuela and pending repatriation. Cash, short-term and long-term investments excluding the funds pending repatriation from Venezuela represent approximately 26% of the last twelve months’ revenues.


Total debt at the end of 1Q15 amounted to US$1.15 billion, all of which is related to aircraft and equipment financing.


Copa Holdings’ first quarter results are the product of a solid and well executed business model based on the goal of operating the best and most convenient network for intra-Latin America travel. Going forward, the Company will continue to strengthen its long-term competitive position by taking advantage of new growth opportunities and implementing initiatives to further strengthen its network and product.








For 2015, the Company updates its guidance as follows: Consolidated capacity growth at +/-6%, down from the previous guidance mainly as a result of capacity reductions in Brazil.


Load factors are now expected to come in at +/-75% as a result of overall weaker demand. Unit revenues (RASM) are expected to come in at +/-11.4 cents, primarily due to weaker currencies and the economic outlook for South America. Unit costs excluding fuel, or CASM ex-fuel, are expected to come in lower at +/-6.5 cents due to lower passenger and sales related expenses, and cost efficiencies.


Factored into the current guidance is an estimated effective price per gallon of jet fuel, including the effect of current hedge contracts and into-plane costs, of US$2.45 per gallon. As a result, the Company is projecting an operating margin in the range of 14% to16% for 2015.  


Financial Outlook   

2015 - Full Year



2015 - Full Year





Capacity - ASM Growth  +/-6%  +/-7%   9.5% 
Average Load Factor  +/-75%  +/-76%   76.7% 
RASM (cents)  +/-11.4  +/-11.8   13.1 
CASM Ex-fuel (cents)  +/-6.5  +/-6.6   6.6 
Operating Margin   14-16%  16-18%   19.8% 




Operating revenue


Copa Holdings’ operating revenue for 1Q15 totaled US$631.8 million, an 11.5% decrease over operating revenue of US$713.6 million in 1Q14. This decrease was primarily due to a 11.3% or US$78.5 million decrease in passenger revenue.


Passenger revenue. For 1Q15 passenger revenue totaled US$613.5 million, an 11.3% decrease over passenger revenue of US$692.0 million in 1Q14. Passenger yield decreased 16.2% to 14.8, while load factor decreased 1.8 percentage points to 76.3%, which resulted in an 18.2% decrease in passenger revenue per ASM (PRASM).


Cargo, mail and other. Cargo, mail and other revenue totaled US$18.3 million in 1Q15, a 15.3% decrease over cargo, mail and other of US$21.6 million in 1Q14.


Operating expenses


For 1Q15, consolidated operating expenses decreased 6.0% to US$504.6 million, representing operating cost per available seat mile (CASM) of 9.3 cents. CASM, excluding fuel costs, decreased 3.4% to 6.3 cents. An overview of the major variances on a consolidated basis follows:






Aircraft fuel. For 1Q15, aircraft fuel totaled US$160.8 million, a US$47.2 million or 22.7% decrease over aircraft fuel of US$208.0 million in 1Q14. This decrease was primarily a result of a 27.5% decrease in the average price per gallon of jet fuel (all-in), which averaged US$2.31 in 1Q15 as compared to US$3.19 in 1Q14, and was partially offset by a 6.6% increase in gallons consumed. The all-in average price per gallon of jet fuel for 1Q15 includes a US$25.7 million fuel hedge loss, compared to a US$2.8 million gain in 1Q14. Excluding the effect of fuel hedge gains for both periods, fuel prices decreased 39.9%, from US$3.23 per gallon in 1Q14 to US$1.94 in 1Q15.


Salaries and benefits. For 1Q15, salaries and benefits totaled US$78.0 million, a 5.5% increase over salaries and benefits of US$74.0 million in 1Q14. The main driver was an increase in operating headcount to support additional capacity, as well as the full-year effect of salary adjustments.


Passenger servicing. For 1Q15, passenger servicing totaled US$66.1 million, a 3.2% increase over passenger servicing of US$64.1 million in 1Q14. This increase resulted from the growth in operations.


Commissions. For 1Q15, commissions totaled US$26.0 million, a 0.6% decrease over commissions of US$26.1 million in 1Q14. This decrease was primarily a result of a lower revenue base, partly offset by a higher average commission rate.


Reservations and sales. Reservations and sales totaled US$21.5 million, a 9.9% decrease over reservation and sales of US$23.9 million in 1Q14. This decrease was primarily a result of a lower revenue base and lower sales related taxes due to the revenue mix.


Maintenance, material and repairs. For 1Q15, maintenance, material and repairs totaled US$25.7 million, a 3.9% increase over maintenance, material and repairs of US$24.7 million in 1Q14. This increase was mainly due to the increase in flight hours.


Depreciation. Depreciation totaled US$31.5 million in 1Q15, a 13.1% increase over depreciation of US$27.8 million in 1Q14. This increase was primarily driven by the full-year effect of four additional aircraft from 2014 and maintenance events.


Flight operations, aircraft rentals, landing fees and other rentals. Combined, flight operations, aircraft rentals, landing fees and other rentals increased 11.0% from US$69.7 million in 1Q14 to US$77.3 million in 1Q15, primarily as a result of an increase in departures and additional aircraft rentals.


Other. Other expenses totaled US$17.6 million, a decrease of US$0.6 million from 1Q14. This was primarily a result of a reduction in other general administrative expenses.


Non-operating income (expense)


Consolidated non-operating income (expense) totaled a net non-operating income of US$0.8 million in 1Q15, compared to a net expense of US$3.3 million in 1Q14.


Interest expense. Interest expense totaled US$7.6 million in 1Q15, a 7.0% increase from interest expense of US$7.1 million in 1Q14, as a result of a higher effective interest rate and outstanding debt balance related to recent aircraft deliveries.


Interest income. Interest income totaled US$6.3 million, a 68.0% increase over interest income of US$3.7 million in 1Q14.






Other, net. Other, net totaled a net gain of US$2.1 million in 1Q15, compared to a net gain of US$0.1 million in 1Q14. Other, net, for 1Q15, consists mainly of a fuel hedge mark-to-market gain of US$7.1 million and a US$3.3 million loss due to transactional and translational foreign currency devaluation, compared to a fuel hedge mark-to-market loss of US$3.4 million and a US$1.2 million gain on the Venezuelan Bolivar for 1Q14.


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 73 destinations in 30 countries in North, Central and South America and the Caribbean with one of the youngest and most modern fleets in the industry, consisting of 98 aircraft: 72 Boeing 737NG aircraft and 26 EMBRAER-190s. For more information visit:


CONTACT: Copa Holdings S.A.

Investor Relations:

Ph: (507) 304-2431 (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.





Copa Holdings, S.A.

Income Statement - IFRS

(US$ Thousands)


   Unaudited     Unaudited     %     Unaudited     % 
   1Q15     1Q14     Change     4Q14     Change 
Operating Revenues                         
Passenger Revenue   613,510    691,977    -11.3%   649,521    -5.5%
Cargo, mail and other   18,323    21,629    -15.3%   21,406    -14.4%
Total Operating Revenue   631,833    713,605    -11.5%   670,927    -5.8%
Operating Expenses                         
Aircraft fuel   160,791    208,014    -22.7%   194,143    -17.2%
Salaries and benefits   78,022    73,976    5.5%   81,605    -4.4%
Passenger servicing   66,142    64,118    3.2%   70,319    -5.9%
Commissions   25,988    26,132    -0.6%   25,311    2.7%
Reservations and sales   21,500    23,853    -9.9%   23,809    -9.7%
Maintenance, material and repairs   25,709    24,746    3.9%   23,187    10.9%
Depreciation   31,464    27,821    13.1%   31,512    -0.2%
Flight operations   33,346    31,134    7.1%   34,461    -3.2%
Aircraft rentals   30,245    25,315    19.5%   30,152    0.3%
Landing fees and other rentals   13,748    13,253    3.7%   13,745    0.0%
Other   17,601    18,246    -3.5%   23,847    -26.2%
Total Operating Expense   504,555    536,607    -6.0%   552,091    -8.6%
Operating Income   127,279    176,999    -28.1%   118,836    7.1%
Non-operating Income (Expense):                         
Interest expense   (7,590)   (7,094)   7.0%   (7,940)   -4.4%
Interest income   6,275    3,736    68.0%   6,379    -1.6%
Other, net   2,083    67    n/m    (81,867)   n/m 
Total Non-Operating Income/(Expense)   768    (3,291)   -123.4%   (83,427)   -100.9%
Income before Income Taxes   128,047    173,707    -26.3%   35,409    261.6%
Provision for Income Taxes   14,926    22,350    -33.2%   (516)   n/m 
Net Income   113,121    151,357    -25.3%   35,925    214.9%
EPS - Basic and Diluted   2.57    3.41    -24.7%   0.81    216.9%
Shares - Basic and Diluted   44,077,111    44,402,832    -0.7%   44,354,963    -0.6%






Copa Holdings, S.A.

Balance Sheet - IFRS

(US$ Thousands)


   March 31,   December 31, 
   2015   2014 
   (Unaudited)   (Audited) 
Current Assets:          
Cash and cash equivalents  $220,409   $221,443 
Short-term investments   380,872    545,160 
Total cash, cash equivalents and short-term investments   601,281    766,603 
Accounts receivable, net of allowance for doubtful accounts   138,234    121,258 
Accounts receivable from related parties   755    892 
Expendable parts and supplies, net of allowance for obsolescence   61,891    59,954 
Prepaid expenses   61,818    56,793 
Other current assets   6,455    5,949 
Total Current Assets   870,434    1,011,449 
Long-term investments   558,290    396,802 
Property and Equipment:          
Owned property and equipment:          
Flight equipment   2,776,098    2,725,407 
Other equipment   94,337    89,257 
    2,870,435    2,814,664 
Less: Accumulated depreciation   (651,761)   (630,503)
    2,218,674    2,184,161 
Purchase deposits for flight equipment   324,466    321,175 
Total Property and Equipment   2,543,139    2,505,336 
Other Assets:          
Net pension asset   13,473    13,784 
Goodwill   18,928    20,380 
Intangible asset   38,506    36,915 
Deferred tax Assets   12,985    17,235 
Other assets   86,307    88,973 
Total Other Assets   170,199    177,287 
Total Assets  $4,142,063   $4,090,874 
Current Liabilities:          
Current maturities of long-term debt  $206,544   $187,646 
Accounts payable   115,340    125,412 
Accounts payable to related parties   10,625    6,749 
Air traffic liability   382,742    408,012 
Taxes and interest payable   67,030    58,554 
Accrued expenses payable   76,412    85,847 
Other current liabilities   98,307    109,277 
Total Current Liabilities   957,000    981,497 
Non-Current Liabilities:          
Long-term debt   943,003    928,964 
Post employment benefits liability   11,834    11,262 
Other long-term liabilities   66,508    57,747 
Deferred tax liabilities   31,775    36,296 
Total Non-Current Liabilities   1,053,120    1,034,269 
Total Liabilities   2,010,120    2,015,766 
Shareholders' Equity:          
Class A - 33,451,370 issued and  32,977,353 outstanding   20,923    20,859 
Class B - 10,938,125 shares issued and outstanding   7,466    7,466 
Additional paid in capital   54,562    53,486 
Treasury Stock   (36,274)   (18,426)
Retained earnings   2,084,253    2,011,485 
Accumulated other comprehensive income (loss)   1,013    238 
Total Shareholders' Equity   2,131,943    2,075,108 
Total Liabilities and Shareholders' Equity  $4,142,063   $4,090,874 








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  1Q15   1Q14   4Q14 
Net income as Reported  $113,121   $151,357   $35,925 
Special Items (adjustments):               
Unrealized (gain) loss on fuel hedging instruments   7,115    (3,373)   (89,058)
(Loss) gain due to devaluation of Venezuelan Bolivar   (36)   1,178    (350)
Adjusted Net Income  $106,043   $153,553   $125,333 
Shares used for Computation (in thousands)               
Basic and Diluted   44,077    44,403    44,355 
Adjusted earnings per share - Basic and Diluted   2.41    3.46    2.83 


Reconciliation Operating Costs per ASM            
Excluding Fuel and Special Items  1Q15   1Q14   4Q14 
Operating Costs per ASM as Reported   9.3    10.7    10.3 
Aircraft fuel per ASM   (3.0)   (4.1)   (3.6)
Operating Costs per ASM excluding fuel   6.3    6.6    6.7