Copa Holdings Reports Financial Results for the Fourth Quarter and Full-Year 2022
PANAMA CITY, Panama, Feb. 15, 2023 /PRNewswire/ -- February 15, 2023. Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the fourth quarter of 2022 (4Q22) and the full year of 2022. The terms "Copa Holdings" and 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 the financial tables section of this earnings release. Unless otherwise stated, all comparisons with prior periods refer to the fourth quarter of 2019 (4Q19) (which the Company believes are more relevant than year-over-year comparisons due to the significant impact of the COVID-19 pandemic in 2020 and 2021).
OPERATING AND FINANCIAL HIGHLIGHTS
- Copa Holdings reported a net profit of US$88.3 million for 4Q22 or US$2.23 per share, mainly driven by the continued effect of high fuel prices as well as the negative mark-to-market effect of the Company's convertible notes.
- Excluding special items, comprised of the unrealized mark-to-market net loss of US$89.4 million mentioned above related to the Company's convertible notes, as well as changes in the value of financial investments, the Company would have reported a net profit of US$177.7 million or US$4.49 per share.
- For the full-year 2022, the Company reported a net profit of US$348.1 million or US$8.58 per share. Excluding special items, comprised of an unrealized mark-to-market net gain of US$12.7 million related to the Company's convertible notes as well as changes in the value of financial investments, Copa Holdings would have reported an adjusted net profit of US$335.4 million or US$8.26 per share, compared to a net profit of US$336.3 million or earnings per share of US$7.92 in 2019.
- In 4Q22, Copa Holdings reported an operating profit of US$219.7 million and a 24.7% operating margin.
- For the full-year 2022, the Company reported an operating profit of US$450.4 million and an operating margin of 15.2%, compared to an adjusted operating profit of US$435.5 million and an operating margin of 16.1% in 2019.
- Total revenues for 4Q22 increased 30.6% to US$890.6 million, as compared to 4Q19 revenues. Yields increased 20.4% to 15.1 cents and revenue per available seat mile (RASM) increased 23.4% to 13.7 cents.
- Adjusted operating cost per available seat mile (Adjusted CASM) increased 10.3% from 9.3 cents in 4Q19 to 10.3 cents in 4Q22, driven by an increase of 63.1% in the price of fuel per gallon. Adjusted CASM excluding fuel (Adjusted Ex-fuel CASM) decreased 7.0% in the quarter to 6.1 cents, as compared to 4Q19.
- Passenger traffic, measured in terms of revenue passenger mile (RPMs), increased by 7.5% compared to 4Q19, while capacity (ASMs) increased by 5.9%. As a result, load factors for the quarter increased by 1.4 percentage points to 86.6%.
- The Company ended the quarter with approximately US$1.1 billion in cash, short-term and long-term investments, which represent 38.3% of the last twelve months' revenues, compared to US$1.2 billion held at the end of 2021.
- The Company closed the quarter with total debt, including lease liabilities, of US$1.7 billion, compared to US$1.6 billion at the end of 2021.
- During the quarter, the Company took delivery of two Boeing 737 MAX 9 aircraft, ending the year with a consolidated fleet of 97 aircraft – 67 Boeing 737-800s, 20 Boeing 737 MAX 9s, 9 Boeing 737-700s, and 1 Boeing 737-800 freighter, compared to a fleet of 102 aircraft prior to the COVID-19 pandemic.
- Copa Airlines had an on-time performance for the quarter of 86.1% and a flight completion factor of 99.6%.
Subsequent Events
- In January, the Company took delivery of one Boeing 737 MAX 9 and expects to receive one additional aircraft by the end of the first quarter.
- In January, Copa Airlines was recognized by OAG as the most on-time airline in Latin America in 2022. Copa Airlines' on-time performance of 87.5% for the year was the highest of any carrier in the Americas.
- In February, the Company announced the commencement of services to Manta, Ecuador, Baltimore-Washington International Airport, and Austin, Texas, bringing the total number of destinations in our network to 80. All new services are scheduled to start between June and July of 2023.
Consolidated Financial | 4Q22 | 4Q19 (2) | Variance vs. 3Q19 | 3Q22 | Variance vs. 2Q22 | FY22 | FY19 (2) | Variance vs. YTD19 |
Revenue Passengers Carried (000s) | 2,813 | 2,633 | 6.9 % | 2,755 | 2.1 % | 10,334 | 10,474 | -1.3 % |
Revenue Passengers OnBoard (000s) | 4,262 | 3,838 | 11.1 % | 4,190 | 1.7 % | 15,724 | 15,424 | 1.9 % |
RPMs (millions) | 5,639 | 5,244 | 7.5 % | 5,508 | 2.4 % | 20,779 | 21,303 | -2.5 % |
ASMs (millions) | 6,509 | 6,149 | 5.9 % | 6,344 | 2.6 % | 24,430 | 25,113 | -2.7 % |
Load Factor | 86.6 % | 85.3 % | 1.4 p.p. | 86.8 % | -0.2 p.p. | 85.1 % | 84.8 % | 0.2 p.p. |
Yield (US$ Cents) | 15.1 | 12.5 | 20.4 % | 14.1 | 7.5 % | 13.6 | 12.3 | 10.8 % |
PRASM (US$ Cents) | 13.1 | 10.7 | 22.4 % | 12.2 | 7.3 % | 11.6 | 10.4 | 11.1 % |
RASM (US$ Cents) | 13.7 | 11.1 | 23.4 % | 12.8 | 7.2 % | 12.1 | 10.8 | 12.6 % |
CASM (US$ Cents) | 10.3 | 10.8 | -4.6 % | 10.5 | -1.8 % | 10.3 | 9.4 | 9.5 % |
Adjusted CASM (US$ Cents) (1) | 10.3 | 9.3 | 10.3 % | 10.5 | -1.8 % | 10.3 | 9.0 | 13.8 % |
CASM Excl. Fuel (US$ Cents) | 6.1 | 8.0 | -23.9 % | 5.9 | 3.4 % | 6.0 | 6.6 | -9.7 % |
Adjusted CASM Excl. Fuel (US$ Cents) (1) | 6.1 | 6.6 | -7.0 % | 5.9 | 3.4 % | 6.0 | 6.3 | -4.6 % |
Fuel Gallons Consumed (millions) | 77.7 | 78.9 | -1.6 % | 75.7 | 2.7 % | 291.4 | 321.4 | -9.4 % |
Avg. Price Per Fuel Gallon (US$) | 3.52 | 2.16 | 63.1 % | 3.81 | -7.5 % | 3.60 | 2.16 | 66.9 % |
Average Length of Haul (miles) | 2,005 | 1,992 | 0.7 % | 1,999 | 0.3 % | 2,011 | 2,034 | -1.1 % |
Average Stage Length (miles) | 1,266 | 1,279 | -1.0 % | 1,265 | 0.1 % | 1,275 | 1,288 | -1.0 % |
Departures | 32,112 | 32,441 | -1.0 % | 31,484 | 2.0 % | 120,155 | 131,819 | -8.8 % |
Block Hours | 104,822 | 105,620 | -0.8 % | 102,027 | 2.7 % | 390,639 | 431,749 | -9.5 % |
Average Aircraft Utilization (hours) | 11.8 | 11.3 | 4.7 % | 11.7 | 0.6 % | 11.3 | 11.4 | -0.7 % |
Operating Revenues (US$ millions) | 890.6 | 681.9 | 30.6 % | 809.4 | 10.0 % | 2,965.0 | 2,707.4 | 9.5 % |
Operating Profit (Loss) (US$ millions) | 219.7 | 17.8 | 1133.7 % | 143.7 | 52.9 % | 450.4 | 346.2 | 30.1 % |
Adjusted Operating Profit (Loss) (US$ millions) (1) | 219.7 | 107.1 | 105.0 % | 143.7 | 52.9 % | 450.4 | 435.5 | 3.4 % |
Operating Margin | 24.7 % | 2.6 % | 22.1 p.p. | 17.8 % | 6.9 p.p. | 15.2 % | 12.8 % | 2.4 p.p. |
Adjusted Operating Margin (1) | 24.7 % | 15.7 % | 9.0 p.p. | 17.8 % | 6.9 p.p. | 15.2 % | 16.1 % | -0.9 p.p. |
Net Profit (Loss) (US$ millions) | 88.3 | 2.7 | 3136.5 % | 115.9 | -23.9 % | 348.1 | 247.0 | 40.9 % |
Adjusted Net Profit (Loss) (US$ millions) (1) | 177.7 | 92.1 | 93.0 % | 115.1 | 54.4 % | 335.4 | 336.3 | -0.3 % |
Basic EPS (US$) | 2.23 | 0.06 | 3376.5 % | 2.93 | -23.8 % | 8.58 | 5.81 | 47.5 % |
Adjusted Basic EPS (US$) (1) | 4.49 | 2.17 | 107.3 % | 2.91 | 54.5 % | 8.26 | 7.92 | 4.4 % |
Shares for calculation of Basic EPS (000s) | 39,554 | 42,487 | -6.9 % | 39,589 | -0.1 % | 40,582 | 42,483 | -4.5 % |
- Excludes Special Items. This earnings release includes a reconciliation of non-IFRS financial measures to the comparable IFRS measures.
- The Company believes that comparisons with 2019 are more relevant than year-over-year comparisons due to the significant impacts in 2020 and 2021 of the COVID-19 pandemic.
FULL 4Q22 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT:
https://copa.gcs-web.com/financial-information/quarterly-results
4Q22 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST
Date: | February 16, 2023 |
Time: | 11:00 AM US ET (11:00 AM Local Time) |
Join by phone: | https://register.vevent.com/register/BI8567059673b04e0e952de6002edc9803 |
Webcast (listen-only): | |
Speakers: | Pedro Heilbron, Chief Executive Officer |
José Montero, Chief Financial Officer |
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 countries in North, Central, and South America and the Caribbean. For more information visit: www.copaair.com.
CONTACT: Copa Holdings S.A.
Investor Relations:
Ph: 011 507 304-2774
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 several 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.
CPA-G
Copa Holdings, S.A. | ||||||||||||||
Income Statement - IFRS | ||||||||||||||
(US$ Thousands) | ||||||||||||||
Unaudited | Unaudited | % | Unaudited | % | Unaudited | Audited | % | |||||||
4Q22 | 4Q19 | Change | 3Q22 | Change | FY22 | FY19 | Change | |||||||
Operating Revenues | ||||||||||||||
Passenger revenue | 852,291 | 657,940 | 29.5 % | 774,230 | 10.1 % | 2,824,719 | 2,612,605 | 8.1 % | ||||||
Cargo and mail revenue | 27,095 | 16,033 | 69.0 % | 26,400 | 2.6 % | 101,765 | 62,460 | 62.9 % | ||||||
Other operating revenue | 11,226 | 7,955 | 41.1 % | 8,815 | 27.4 % | 38,549 | 32,343 | 19.2 % | ||||||
Total Operating Revenue | 890,612 | 681,927 | 30.6 % | 809,445 | 10.0 % | 2,965,033 | 2,707,409 | 9.5 % | ||||||
Operating Expenses | ||||||||||||||
Fuel | 273,901 | 171,314 | 59.9 % | 291,528 | -6.0 % | 1,052,637 | 696,249 | 51.2 % | ||||||
Wages, salaries, benefits and other employees' expenses | 105,019 | 115,036 | -8.7 % | 96,612 | 8.7 % | 380,385 | 450,438 | -15.6 % | ||||||
Passenger servicing | 19,518 | 24,798 | -21.3 % | 18,881 | 3.4 % | 70,080 | 102,103 | -31.4 % | ||||||
Airport facilities and handling charges | 49,734 | 44,877 | 10.8 % | 49,783 | -0.1 % | 192,584 | 181,959 | 5.8 % | ||||||
Sales and distribution | 61,498 | 53,222 | 15.5 % | 60,712 | 1.3 % | 224,465 | 210,623 | 6.6 % | ||||||
Maintenance, materials and repairs | 28,875 | 37,648 | -23.3 % | 23,577 | 22.5 % | 104,114 | 127,562 | -18.4 % | ||||||
Depreciation and amortization | 70,251 | 159,812 | -56.0 % | 68,813 | 2.1 % | 267,704 | 371,424 | -27.9 % | ||||||
Flight operations | 25,667 | 24,908 | 3.0 % | 25,483 | 0.7 % | 97,256 | 102,806 | -5.4 % | ||||||
Other operating and administrative expenses | 36,492 | 32,506 | 12.3 % | 30,363 | 20.2 % | 125,424 | 118,090 | 6.2 % | ||||||
Total Operating Expense | 670,954 | 664,123 | 1.0 % | 665,752 | 0.8 % | 2,514,648 | 2,361,255 | 6.5 % | ||||||
Operating Profit/(Loss) | 219,657 | 17,804 | 1133.7 % | 143,692 | 52.9 % | 450,384 | 346,154 | 30.1 % | ||||||
Non-operating Income (Expense): | ||||||||||||||
Finance cost | (23,388) | (17,154) | 36.3 % | (22,528) | 3.8 % | (87,631) | (57,432) | 52.6 % | ||||||
Finance income | 7,413 | 6,289 | 17.9 % | 4,546 | 63.1 % | 18,030 | 24,405 | -26.1 % | ||||||
Gain (loss) on foreign currency fluctuations | (2,560) | 2,406 | -206.4 % | (3,335) | -23.2 % | (9,812) | (15,408) | -36.3 % | ||||||
Net change in fair value of derivatives | (91,305) | - | -100.0 % | 1,575 | -5897.1 % | 17,189 | - | -100.0 % | ||||||
Other non-operating income (expense) | 1,221 | (989) | -223.4 % | 4,230 | -71.1 % | 70 | (4,279) | -101.6 % | ||||||
Total Non-Operating Income/(Expense) | (108,619) | (9,448) | 1049.7 % | (15,513) | 600.2 % | (62,155) | (52,715) | 17.9 % | ||||||
Profit before taxes | 111,039 | 8,356 | 1228.8 % | 128,179 | -13.4 % | 388,229 | 293,439 | 32.3 % | ||||||
Income tax expense | (22,758) | (5,629) | 304.3 % | (12,241) | 85.9 % | (40,176) | (46,437) | -13.5 % | ||||||
Net Profit/(Loss) | 88,280 | 2,728 | 3136.5 % | 115,939 | -23.9 % | 348,054 | 247,002 | 40.9 % | ||||||
EPS | ||||||||||||||
Basic | 2.23 | 0.06 | 3376.5 % | 2.93 | -23.8 % | 8.58 | 5.81 | 47.5 % | ||||||
Shares used for calculation: | ||||||||||||||
Basic | 39,554,071 | 42,486,717 | -6.9 % | 39,588,984 | -0.1 % | 40,581,616 | 42,483,048 | -4.5 % | ||||||
Copa Holdings, S. A. and subsidiaries | |||
Consolidated statement of financial position | |||
(US$ Thousands) | |||
December 2022 | December 2021 | December 2019 | |
ASSETS | (Unaudited) | (Audited) | (Audited) |
Cash and cash equivalents | 122,424 | 211,081 | 158,732 |
Short-term investments | 812,323 | 806,340 | 692,403 |
Total cash, cash equivalents and short-term investments | 934,747 | 1,017,421 | 851,135 |
- | |||
Accounts receivable, net | 135,354 | 90,618 | 129,634 |
Accounts receivable from related parties | 2,229 | 1,832 | 147 |
Expendable parts and supplies, net | 93,332 | 74,778 | 69,100 |
Prepaid expenses | 43,933 | 31,148 | 49,034 |
Prepaid income tax | 798 | 16,938 | 1,181 |
Other current assets | 17,044 | 6,054 | 14,206 |
292,689 | 221,368 | 263,302 | |
Asset held for sale | 120,006 | ||
TOTAL CURRENT ASSETS | 1,227,436 | 1,238,789 | 1,234,443 |
Long-term investments | 202,056 | 199,670 | 134,347 |
Long-term accounts receivable | 2,139 | ||
Long-term prepaid expenses | 7,770 | 6,727 | 17,743 |
Property and equipment, net | 2,883,524 | 2,512,704 | 2,532,402 |
Right of use assets | 234,380 | 166,328 | 290,843 |
Intangible, net | 78,555 | 81,749 | 108,116 |
Net defined benefit assets | 504 | - | 249 |
Deferred tax assets | 30,743 | 28,196 | 19,215 |
Other Non-Current Assets | 17,005 | 14,098 | 17,881 |
TOTAL NON-CURRENT ASSETS | 3,454,539 | 3,009,472 | 3,122,935 |
TOTAL ASSETS | 4,681,975 | 4,248,261 | 4,357,378 |
LIABILITIES | |||
Loans and borrowings | 142,484 | 196,602 | 122,582 |
Current portion of lease liability | 80,084 | 73,917 | 97,732 |
Accounts payable | 155,378 | 112,596 | 119,332 |
Accounts payable to related parties | 12,287 | 7,948 | 14,086 |
Air traffic liability | 651,804 | 557,331 | 497,374 |
Frequent flyer deferred revenue | 111,526 | 95,114 | 80,326 |
Taxes Payable | 35,489 | 32,600 | 46,267 |
Employee benefits obligations | 44,913 | 32,767 | 55,373 |
Income tax payable | 6,276 | 3,835 | 9,683 |
Other Current Liabilities | 1,176 | 786 | 84 |
TOTAL CURRENT LIABILITIES | 1,241,416 | 1,113,496 | 1,042,839 |
Loans and borrowings long-term | 1,301,819 | 1,229,031 | 938,183 |
Lease Liability | 158,289 | 104,734 | 206,832 |
Net defined benefit liabilities | - | 7,670 | - |
Derivative financial instruments | 251,150 | 268,338 | - |
Deferred tax Liabilities | 16,571 | 18,782 | 43,397 |
Other long - term liabilities | 220,618 | 206,813 | 191,221 |
TOTAL NON-CURRENT LIABILITIES | 1,948,446 | 1,835,368 | 1,379,633 |
TOTAL LIABILITIES | 3,189,862 | 2,948,864 | 2,422,472 |
EQUITY | - | ||
Class A - 34,033,575 issued and 28,477,704 outstanding | 21,327 | 21,289 | 21,142 |
Class B - 10,938,125 | 7,466 | 7,466 | 7,466 |
Additional Paid-In Capital | 103,466 | 98,348 | 86,135 |
Treasury Stock | (344,541) | (176,902) | (136,388) |
Retained Earnings | 1,367,786 | 1,324,022 | 1,718,177 |
Net profit | 348,054 | 43,844 | 247,002 |
Other comprehensive loss | (11,445) | (18,670) | (8,628) |
TOTAL EQUITY | 1,492,113 | 1,299,397 | 1,934,906 |
TOTAL EQUITY LIABILITIES | 4,681,975 | 4,248,261 | 4,357,378 |
Copa Holdings, S. A. and subsidiaries | |||||||||||
Consolidated Statement of Cash Flows | |||||||||||
For the twelve months ended December 31, | |||||||||||
(In US$ thousands) | |||||||||||
2022 | 2021 | 2020 | |||||||||
(Unaudited) | (Audited) | (Audited) | |||||||||
Cash flow from (used in) operating activities | 740,948 | 462,612 | (39,515) | ||||||||
Cash flow used in investing activities | (555,911) | (459,135) | (93,761) | ||||||||
Cash flow (used in) from financing activities | (273,694) | 88,539 | 93,609 | ||||||||
Net (decrease) increase in cash and cash equivalents | (88,657) | 92,016 | (39,667) | ||||||||
Cash and cash equivalents at January 1 | 211,081 | 119,065 | 158,732 | ||||||||
Cash and cash equivalents at December 31 | $ 122,424 | $ 211,081 | $ 119,065 | ||||||||
Short-term investments | 812,323 | 806,340 | 770,816 | ||||||||
Long-term investments | 202,056 | 199,670 | 119,617 | ||||||||
Total cash and cash equivalents and investments at December 31 | $ 1,136,803 | $ 1,217,091 | $ 1,009,498 | ||||||||
Copa Holdings, S.A.
NON-IFRS FINANCIAL MEASURE RECONCILIATION
This press release includes the following non-IFRS financial measures: Adjusted Operating Profit, Adjusted Net Profit, Adjusted Basic EPS, and Operating CASM Excluding Fuel. 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 profit, and net profit. The following is a reconciliation of these non-IFRS financial measures to the comparable IFRS measures:
Reconciliation of Adjusted Operating Profit | ||||||||||||
and Adjusted Net Profit | 4Q22 | 4Q21 | 3Q22 | 4Q19 | FY22 | FY19 | ||||||
Operating Profit as Reported | $ 219,657 | $ 154,989 | $ 143,692 | $ 17,804 | $ 450,384 | $ 346,154 | ||||||
Subtract: Leased Aircraft Return provision | $ 39,217 | |||||||||||
Add: Fleet Impairment loss | $ 89,344 | $ 89,344 | ||||||||||
Adjusted Operating Profit | $ 219,657 | $ 115,773 | $ 143,692 | $ 107,148 | $ 450,384 | $ 435,497 | ||||||
Net Profit as Reported | $ 88,280 | $ 114,363 | $ 115,939 | $ 2,728 | $ 348,054 | $ 247,002 | ||||||
Subtract: Leased Aircraft Return provision | $ 39,217 | |||||||||||
Add: Fleet Impairment loss | $ 89,344 | $ 89,344 | ||||||||||
Add: Net change in fair value of derivatives | $ 91,305 | $ 8,922 | $ (1,575) | $ (17,189) | ||||||||
Add: Net change in fair value of financial investments | $ (1,924) | $ 699 | $ 4,516 | |||||||||
Adjusted Net Profit | $ 177,661 | $ 84,068 | $ 115,062 | $ 92,072 | $ 335,381 | $ 336,346 | ||||||
Reconciliation of Adjusted Basic EPS | 4Q22 | 4Q21 | 3Q22 | 4Q19 | FY22 | FY19 | ||||||
Adjusted Net Profit | $ 177,661 | $ 84,068 | $ 115,062 | $ 92,072 | $ 335,381 | $ 336,346 | ||||||
Shares used for calculation of Basic EPS | 39,554 | 42,533 | 39,589 | 42,487 | 40,582 | 42,483 | ||||||
Adjusted Basic Earnings per share (Adjusted Basic EPS) | $ 4.49 | $ 1.98 | $ 2.91 | $ 2.17 | $ 8.26 | $ 7.92 | ||||||
Reconciliation of Operating Costs per ASM | ||||||||||||
Excluding Fuel (CASM Excl. Fuel) | 4Q22 | 4Q21 | 3Q22 | 4Q19 | FY22 | FY19 | ||||||
Operating Costs per ASM as Reported (in US$ Cents) | 10.3 | 8.2 | 10.5 | 10.8 | 10.3 | 9.4 | ||||||
Return of leased aircraft provision per ASM (in US$ Cents) | (0.8) | |||||||||||
Fleet Impairment per ASM (in US$ Cents) | 1.5 | 0.3 | ||||||||||
Aircraft Fuel Cost per ASM (in US$ Cents) | 4.2 | 2.9 | 4.6 | 2.8 | 4.3 | 2.8 | ||||||
Operating Costs per ASM excluding fuel (in US$ Cents) | 6.1 | 6.1 | 5.9 | 6.6 | 6.0 | 6.3 | ||||||
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SOURCE Copa Holdings, S.A.
