CPA Q2 2021 Earnings

Call Details

• Call Title: Copa Airlines Q2 2021 Earnings Call
• Date: August 5, 2021 at 3:00 PM UTC
• Management Team:
  • Daniel Tapia (Director of Investor Relations)
  • Pedro Heilbron (Chief Executive Officer)
  • Jose Montero (Chief Financial Officer)

Call Summary

Financial Performance

• Revenues for Q2 2021 were $304 million, an increase of 64% versus the previous quarter.
• Reported net profit was $28.1 million, or $0.66 per share, with an adjusted net loss of $16.2 million, or $(0.38) per share, excluding special items.
• Operating profit was $8.7 million for the quarter, and adjusted operating loss would have been $1.7 million excluding $10.4 million of unredeemed ticket revenue.
• Special items included a $33.9 million unrealized mark-to-market gain on convertible notes and $10.4 million in underpinned ticket revenues.
• Cash accretion averaged $21 million per month in the quarter and exceeded internal expectations due to stronger sales and timing of cash outflows.
• Assets were reported near $4.1 billion and cash, short-term and long-term investments totaled $1.3 billion at quarter end.

Demand & Capacity

• Q2 capacity totaled 2.9 billion ASMs, which represented 48% of Q2 2019 ASMs.
• Load factor averaged 77% for Q2 2021, an improvement of 8 percentage points versus Q1 2021.
• Q3 2021 capacity is guided to approximately 70% of Q3 2019 levels, or about 4.5 billion ASMs.
• Wingo expanded to operate six 737-800s and has been operating more capacity than in 2019 since Q1.
• Management reported leisure and VFR driving recovery with leisure around half of current traffic and VFR approximately one third, while corporate travel remains roughly 50% of pre-pandemic levels.
• Management stated markets remain heterogenous with most countries requiring testing and some restricting flight frequencies, which constrains network restoration.