Copa Holdings reports first quarter net income of $113.1 million, down 25.3% from $151.4 million

Copa Holdings, S.A. (Copa Airlines and Copa Airlines Colombia) (Panama City) has announced its financial results for the first quarter of 2015 (1Q15):

Copa Holdings reported net income of $113.1 million (all amounts in US dollars) for 1Q15, or diluted earnings per share (EPS) of $2.57. Excluding special items, Copa Holdings would have reported an adjusted net income of $106.0 million, or EPS of $2.41 per share, a 30.4% decrease over adjusted net income of $153.6 million and $3.46 per share for 1Q14.

Operating income for 1Q15 came in at $127.3 million, a 28.1% decrease over operating income of $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 $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.

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.