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 August, 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: 2Q15 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: 8/12/2015  
  By: /s/ José Montero
    Name: José Montero
    Title: CFO





Exhibit 99.1



Copa Holdings Reports Net Income of US$64.1 Million and EPS of US$1.46 for the Second Quarter of 2015

Excluding special items, adjusted net income came in at $41.0 million, or EPS of $0.93


Panama City, Panama — August 12, 2015. Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the second quarter of 2015 (2Q15). 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 second quarter of 2014 (2Q14).




§Copa Holdings reported net income of US$64.1 million for 2Q15, or diluted earnings per share (EPS) of US$1.46. Excluding special items, Copa Holdings would have reported an adjusted net income of $41.0 million, or $0.93 per share, a 64.7% decrease over adjusted net income of US$115.9 million and US$2.61 per share for 2Q14.


§Operating income for 2Q15 came in at US$49.2 million, a 62.5% decrease over operating income of US$131.2 million in 2Q14. Operating margin for the period came in at 9.1%, compared to 19.5% in 2Q14, as a result of lower unit revenues partially offset by lower unit costs.


§Total revenues decreased 20.1% to US$538.4 million. Yield per passenger mile decreased 20.4% to 13.2 cents and operating revenue per available seat mile (RASM) decreased 24.4% to 10.0 cents.


§For 2Q15, passenger traffic (RPMs) decreased 0.2% on a 5.8% capacity expansion. As a result, consolidated load factor came in at 72.9%, or 4.3 percentage points below 2Q14.


§Operating cost per available seat mile (CASM) decreased 14.7%, from 10.7 cents in 2Q14 to 9.1 cents in 2Q15, mainly due to lower jet fuel costs. CASM excluding fuel decreased 6.3% to 6.2 cents mainly due to lower sales related expenses and lower overhead expenses.


§Cash, short-term and long-term investments ended 2Q15 at US$1.15 billion, representing 46% of the last twelve months’ revenues. Of this amount, 39%, or US$452.2 million, is in Venezuela pending repatriation due to government currency controls.


§During the second quarter, Copa Airlines took delivery of two Boeing 737-800 aircraft, and returned a leased Boeing 737-700. Furthermore, the Company subleased one of its Boeing 737-700s to United Airlines. As a result, Copa Holdings ended the quarter with a consolidated fleet of 98 aircraft.


§For 2Q15, Copa Holdings reported consolidated on-time performance of 90.4% and a flight-completion factor of 99.7%, maintaining its position among the best in the industry.




§During July 2015, Copa Holdings subleased one more of its Boeing 737-700s to United Airlines.


§Copa Holdings will pay its third quarter dividend of US$0.84 per share on September 15, 2015, on all outstanding Class A and Class B shares, to stockholders of record as of August 31, 2015.






Consolidated Financial &
Operating Highlights
  2Q15   2Q14   % Change    1Q15   % Change  
Revenue Passengers Carried ('000)   1,868    1,890    -1.2%   1,965    -4.9%
RPMs (mm)   3,909    3,916    -0.2%   4,143    -5.6%
ASMs (mm)   5,359    5,067    5.8%   5,433    -1.4%
Load Factor   72.9%   77.3%   -4.3 p.p.   76.3%   -3.3 p.p.
Yield   13.2    16.6    -20.4%   14.8    -10.6%
PRASM (US$ Cents)   9.7    12.8    -24.9%   11.3    -14.5%
RASM (US$ Cents)   10.0    13.3    -24.4%   11.6    -13.6%
CASM (US$ Cents)   9.1    10.7    -14.7%   9.3    -1.7%
CASM Excl. Fuel (US$ Cents)   6.2    6.6    -6.3%   6.3    -1.7%
Breakeven Load Factor (1)   65.6%   60.8%   4.8 p.p.   60.0%   5.6 p.p.
Fuel Gallons Consumed (Millions)   67.9    65.9    3.1%   69.6    -2.5%
Avg. Price Per Fuel Gallon (US$ Dollars)   2.30    3.13    -26.5%   2.31    -0.6%
Average Length of Haul (Miles)   2,093    2,072    1.0%   2,109    -0.8%
Average Stage Length (Miles)   1,243    1,210    2.7%   1,247    -0.4%
Departures   30,078    29,726    1.2%   30,603    -1.7%
Block Hours   95,694    92,115    3.9%   97,530    -1.9%
Average Aircraft Utilization (Hours)   10.8    11.0    -1.5%   11.1    -2.3%
Operating Revenues (US$ mm)   538.4    673.6    -20.1%   631.8    -14.8%
Operating Income (US$ mm)   49.2    131.2    -62.5%   127.3    -61.4%
Operating Margin   9.1%   19.5%   -10.3 p.p.   20.1%   -11.0 p.p.
Net Income (US$ mm)   64.1    118.2    -45.8%   113.1    -43.3%
Adjusted Net Income (US$ mm) (1)   41.0    115.9    -64.7%   106.0    -61.4%
EPS - Basic and Diluted (US$)   1.46    2.66    -45.3%   2.57    -43.3%
Adjusted EPS - Basic and Diluted (US$) (1)   0.93    2.61    -64.4%   2.41    -61.3%
# of Shares - Basic and Diluted ('000)   44,038    44,409    -0.8%   44,077    -0.1%

(1)Breakeven Load Factor, Adjusted Net Income and Adjusted EPS for 2Q15, 2Q14, and 1Q15 exclude non-cash charges/gains associated with the mark-to-market of fuel hedges, and also exclude charges/gains related to the Venezuelan currency.


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




Copa Holdings’ second 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 further demand weakness, mainly in Venezuela, Brazil and Colombia, which were partially offset by a lower fuel expense and lower ex-fuel unit costs for the quarter.


Total revenues decreased 20.1% to US$538.4 million during the quarter on capacity growth of 5.8%. Load factor came in at 72.9%, or 4.3 percentage points below 2Q14, while yields decreased 20.4% to 13.2 cents. As a result, passenger revenues per ASM (PRASM) decreased 24.9%, from 12.8 cents in 2Q14 to 9.7 cents in 2Q15.






Consolidated operating expenses for 2Q15 decreased 9.8% to US$489.2 million, while consolidated operating expenses per ASM (CASM) decreased 14.7% to 9.1 cents. Excluding fuel costs, unit costs decreased 6.3% to 6.2 cents, mainly as a result of lower sales related expenses and lower overhead expenses.


Aircraft fuel expense decreased 24.3%, or US$50.0 million, compared to 2Q14, 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$21.3 million in 2Q15 and a gain of US$3.8 million in 2Q14, decreased from an average of US$3.13 in 2Q14 to US$2.30 in 2Q15. 


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


The Company recorded a net non-operating income of US$22.1 million for 2Q15 compared to a net non-operating income of US$0.8 million for 2Q14. Non-operating income (expense) included a fuel hedge mark-to-market gain of US$23.4 million, compared to a fuel hedge mark-to-market gain of US$4.1 million for 2Q14.


Copa Holdings closed the quarter with US$1.15 billion in cash, short-term and long-term investments, representing 46% of the last twelve months´ revenues. Of such cash, US$452.2 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 28% of the last twelve months’ revenues.


At the end of 2Q15, total debt amounted to US$1.2 billion, all of which is related to aircraft and equipment financing.


Copa Holdings’ second quarter results are mostly the product of a weak economic environment in South America. However, we still have a very solid business model, which is based on 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 +/-5%, down from the previous guidance, mainly as a result of some capacity reductions along the network.


Load factors are still expected to come in at +/-75%. Unit revenues (RASM) are expected to come in lower at +/-10.5 cents, primarily due to further weakening of currencies and demand, mainly in South American markets. Unit costs excluding fuel, or CASM ex-fuel, are still expected to come in at +/-6.5 cents.


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$2.20 per gallon. As a result, the Company is projecting an operating margin in the range of 11% to 13% for 2015.






Financial Outlook    2015 - Full Year
   2015 - Full Year
Capacity - ASM Growth   +/-5%    +/-6%    9.5% 
Average Load Factor   +/-75%    +/-75%    76.7% 
RASM (cents)   +/-10.5    +/-11.4    13.1 
CASM Ex-fuel (cents)   +/-6.5    +/-6.5    6.6 
Operating Margin    11-13%    14-16%    19.8% 




Operating revenue


Copa Holdings’ operating revenue for 2Q15 totaled US$538.4 million, a 20.1% decrease over operating revenue of US$673.6 million in 2Q14. This decrease was primarily due to a 20.5% or US$133.6 million decrease in passenger revenue.


Passenger revenue. For 2Q15, passenger revenue totaled US$517.5 million, a 20.5% decrease over passenger revenue of US$651.1 million in 2Q14. Passenger yield decreased 20.4% to 13.2, while load factor decreased 4.3%, which resulted in a 24.9% decrease in passenger revenue per ASM (PRASM).


Cargo, mail and other. Cargo, mail and other revenue totaled US$20.8 million in 2Q15, a 7.3% decrease from cargo, mail and other of US$22.5 million in 2Q14.


Operating expenses


For 2Q15, consolidated operating expenses decreased 9.8% to US$489.2 million, representing operating cost per available seat mile (CASM) of 9.1 cents. CASM, excluding fuel costs, decreased 6.3% to 6.2 cents. An overview of the major variances on a consolidated basis follows.


Aircraft fuel. For 2Q15, aircraft fuel totaled US$155.9 million, a US$50.0 million or 24.3% decrease over aircraft fuel of US$205.9 million in 2Q14. This decrease was primarily a result of a 3.1% increase in gallons consumed, and a 26.5% decrease in the average price per gallon of jet fuel (all-in), which averaged US$2.30 in 2Q15 as compared to US$3.13 in 2Q14. The all-in average price per gallon of jet fuel for 2Q15 includes a $21.3 million fuel hedge loss, compared to a US$3.8 million gain in 2Q14. Excluding the effect of fuel hedge results for both periods, fuel prices decreased 37.7%, from US$3.18 per gallon in 2Q14 to US$1.98 in 2Q15.


Salaries and benefits. For 2Q15, salaries and benefits totaled US$69.2 million, a 0.5% decrease over salaries and benefits of US$69.6 million in 2Q14. The main driver was a positive effect of foreign exchange rates partially offset by an increase in operating headcount to support additional capacity.


Passenger servicing. For 2Q15, passenger servicing totaled US$63.3 million, a 3.4% decrease over passenger servicing of US$65.5 million in 2Q14. This decrease resulted primarily from fewer passengers carried and a decrease in irregular operations.


Commissions. For 2Q15, commissions totaled US$20.4 million, a 16.7% decrease over commissions of US$24.5 million in 2Q14. 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$22.0 million, a 8.1% decrease from reservation and sales of US$24.0 million in 2Q14. This decrease was primarily a result of a lower revenue base and fewer GDS bookings.


Maintenance, material and repairs. For 2Q15, maintenance, material and repairs totaled US$28.0 million, a 4.4% decrease over maintenance, material and repairs of US$29.3 million in 2Q14. This decrease was mainly a result of lower aircraft lease return costs versus provisions.


Depreciation. Depreciation totaled US$33.9 million in 2Q15, a 22.0% increase over depreciation of US$27.7 million in 2Q14. This increase was primarily driven by the full-year effect of four additional aircraft and maintenance events from 2014, 2015 aircraft deliveries, and the accelerated depreciation of maintenance events related to leased aircraft returns scheduled for later this year.


Flight operations, aircraft rentals, landing fees and other rentals. Combined, flight operations, aircraft rentals, landing fees and other rentals increased 4.3% from US$74.3 million in 2Q14 to US$77.5 million in 2Q15, primarily as a result of an increase in departures, additional aircraft rentals, and additional exchange part rentals.


Other. Other expenses totaled US$19.0 million, a decrease of US$2.5 million over 2Q14. This was primarily a result of a decrease in other general administrative expenses.


Non-operating income (expense)


Consolidated non-operating income (expense) totaled a net income of US$22.1 million in 2Q15, compared to a net income of US$0.8 million in 2Q14.


Interest expense. Interest expense totaled US$8.4 million in 2Q15, a 21.8% increase from interest expense of US$6.9 million in 2Q14, as a result of a higher effective interest rate and outstanding debt balance related to recent aircraft deliveries.


Interest income. Interest income totaled US$5.8 million, a 61.5% increase over interest income of US$3.6 million in 2Q14.


Other, net. Other, net totaled a net gain of US$24.7 million in 2Q15, compared to a net gain of US$4.1 million in 2Q14. Other, net for 2Q15, includes a fuel hedge mark-to-market gain of US$23.4 million, compared to a fuel hedge mark-to-market gain of US$4.1 million for 2Q14.


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 74 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 97 aircraft: 71 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   % 
   2Q15   2Q14   Change   1Q15   Change 
Operating Revenues                         
Passenger Revenue   517,508    651,081    -20.5%   613,510    -15.6%
Cargo, mail and other   20,846    22,480    -7.3%   18,323    13.8%
Total Operating Revenue   538,354    673,560    -20.1%   631,833    -14.8%
Operating Expenses                         
Aircraft fuel   155,908    205,942    -24.3%   160,791    -3.0%
Salaries and benefits   69,204    69,584    -0.5%   78,022    -11.3%
Passenger servicing   63,315    65,533    -3.4%   66,142    -4.3%
Commissions   20,383    24,467    -16.7%   25,988    -21.6%
Reservations and sales   22,033    23,978    -8.1%   21,500    2.5%
Maintenance, material and repairs   27,999    29,301    -4.4%   25,709    8.9%
Depreciation   33,855    27,744    22.0%   31,464    7.6%
Flight operations   32,605    32,547    0.2%   33,346    -2.2%
Aircraft rentals   30,034    28,534    5.3%   30,245    -0.7%
Landing fees and other rentals   14,889    13,250    12.4%   13,748    8.3%
Other   18,973    21,490    -11.7%   17,601    7.8%
Total Operating Expense   489,197    542,369    -9.8%   504,555    -3.0%
Operating Income   49,157    131,192    -62.5%   127,279    -61.4%
Non-operating Income (Expense):                         
Interest expense   (8,372)   (6,876)   21.8%   (7,590)   10.3%
Interest income   5,789    3,586    61.5%   6,275    -7.7%
Other, net   24,657    4,107    n/m    2,083    n/m 
Total Non-Operating Income/(Expense)   22,074    817    n/m    768    n/m 
Income before Income Taxes   71,231    132,008    -46.0%   128,047    -44.4%
Provision for Income Taxes   7,134    13,836    -48.4%   14,926    -52.2%
Net Income   64,097    118,172    -45.8%   113,121    -43.3%
EPS - Basic and Diluted   1.46    2.66    -45.3%   2.57    -43.3%
Shares - Basic and Diluted   44,037,684    44,408,515    -0.8%   44,077,111    -0.1%






Copa Holdings, S.A.        
Balance Sheet - IFRS        
(US$ Thousands)      
   June 30,   December 31, 
   2015   2014 
   (Unaudited)   (Audited) 
Current Assets:          
Cash and cash equivalents  $190,328   $221,443 
Restricted cash and cash equivalents   27,260      
Short-term investments   410,000    545,160 
Total cash, cash equivalents and short-term investments   627,588    766,603 
Accounts receivable, net of allowance for doubtful accounts   116,659    121,258 
Accounts receivable from related parties   2,168    892 
Expendable parts and supplies, net of allowance for obsolescence   59,303    59,954 
Prepaid expenses   69,152    56,793 
Other current assets   7,763    5,949 
Total Current Assets   882,633    1,011,449 
Long-term investments   526,132    396,802 
Property and Equipment:          
Owned property and equipment:          
Flight equipment   2,884,315    2,725,407 
Other equipment   106,437    89,257 
    2,990,752    2,814,664 
Less: Accumulated depreciation   (687,532)   (630,503)
    2,303,219    2,184,161 
Purchase deposits for flight equipment   272,441    321,175 
Total Property and Equipment   2,575,660    2,505,336 
Other Assets:          
Net pension asset   20,291    13,784 
Goodwill   19,243    20,380 
Intangible asset   43,552    36,915 
Deferred tax Assets   24,412    17,235 
Other assets   79,464    88,973 
Total Other Assets   186,962    177,287 
Total Assets  $4,171,388   $4,090,874 
Current Liabilities:          
Current maturities of long-term debt  $201,741   $187,646 
Accounts payable   90,616    125,412 
Accounts payable to related parties   10,042    6,749 
Air traffic liability   385,564    408,012 
Taxes and interest payable   63,662    58,554 
Accrued expenses payable   66,124    85,847 
Other current liabilities   79,662    109,277 
Total Current Liabilities   897,411    981,497 
Non-Current Liabilities:          
Long-term debt   988,841    928,964 
Post employment benefits liability   15,932    11,262 
Other long-term liabilities   67,867    57,747 
Deferred tax liabilities   44,020    36,296 
Total Non-Current Liabilities   1,116,661    1,034,269 
Total Liabilities   2,014,072    2,015,766 
Shareholders' Equity:          
Class A - 33,456,095 issued and 32,977,353 outstanding   20,924    20,859 
Class B - 10,938,125 shares issued and outstanding   7,466    7,466 
Additional paid in capital   55,360    53,486 
Treasury Stock   (36,274)   (18,426)
Retained earnings   2,114,547    2,011,485 
Accumulated other comprehensive income (loss)   (4,706)   238 
Total Shareholders' Equity   2,157,316    2,075,108 
Total Liabilities and Shareholders' Equity  $4,171,388   $4,090,874 






Copa Holdings, S. A. and subsidiaries

Consolidated Statement of Cash Flows

For the six months ended June 30,

(In US$ thousands)


   2015   2014   2013 
   (Unaudited)   (Unaudited)   (Unaudited) 
Cash flow from operating activities   194,620    273,835    383,779 
Cash flow from (used) in investing activities   (197,718)   (91,020)   30,570 
Cash flow used in financing activities   (28,017)   (149,822)   (163,058)
Net increase (decrease) in cash and cash equivalents   (31,115)   32,993    251,291 
Cash and cash equivalents at December 31   221,443    139,110    76,094 
Cash and cash equivalents at June 30 *  $190,328   $172,103   $327,385 
Short-term investments **   410,000    723,808    479,676 
Long-term investments ***   526,132    253,875    41,591 
Restricted cash and cash equivalents ****   27,260    52,425    - 
Total cash and cash equivalents and investments at June 30  $1,153,720   $1,202,211   $848,652 


* At June 2015 and 2014, cash and cash equivelents include $17 million and $7 million, respectively, of cash in Venezuela which the Company expects to use over the next quarter as part of the normal operations in that country.

** Short term - investments include $264 million of cash in Venezuela at june 2014.

*** Long term - investments include $435 million and $253 million at june 2015 and 2014 of cash in Venezuela, respectively.

**** Restricted cash correspond to a margin calls to secure derivative financial instruments transactions.








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  2Q15   2Q14   1Q15 
Net income as Reported  $64,097   $118,172   $113,121 
Special Items (adjustments):               
Unrealized (gain) loss on fuel hedging instruments   (23,409)   (4,105)   (7,115)
(Loss) gain due to devaluation of Venezuelan Bolivar   (294)   (1,874)   36 
Adjusted Net Income  $40,982   $115,941   $105,970 
Shares used for Computation (in thousands)               
Basic and Diluted   44,038    44,409    44,077 
Adjusted earnings per share - Basic and Diluted   0.93    2.61    2.40 
Reconciliation Operating Costs per ASM               
Excluding Fuel and Special Items  1Q15   1Q14   4Q14 
Operating Costs per ASM as Reported   9.1    10.7    9.3 
Aircraft fuel per ASM   (2.9)   (4.1)   (3.0)
Operating Costs per ASM excluding fuel   6.2    6.6    6.3