Copa Holdings Reports Financial Results for the Fourth Quarter and Full-Year 2021

Rhea-AI Summary

Copa Holdings, S.A. (NYSE: CPA) reported a net profit of US$114.4 million or US$2.69 per share for 4Q21, with an operating profit of US$155.0 million. Excluding special items, the adjusted net profit was US$84.1 million or US$1.98 per share. Total revenues reached US$575.0 million, with passenger revenues at 82.2% of 4Q19 levels. The company maintained US$1.5 billion in liquidity. For FY21, net profit was US$39.9 million, down from US$247 million in FY19, showing ongoing pandemic impacts on overall performance.

Positive

• 4Q21 net profit of US$114.4 million compared to US$2.7 million in 4Q19.
• Operating profit of US$155.0 million, a significant increase from US$17.8 million in 4Q19.
• Passenger yield increased 1.0% to 12.7 cents.

Negative

• Passenger revenues for 4Q21 at 82.2% of 4Q19 levels, indicating ongoing performance challenges.
• Overall capacity in 4Q21 at only 83.1% of the capacity flown in 4Q19.
• Total debt, including lease liabilities, remained high at US$1.6 billion.

PANAMA CITY, Panama, Feb. 9, 2022 /PRNewswire/ -- Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the fourth quarter of 2021 (4Q21) and full year 2021. 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 impacts in 2020 of the COVID-19 pandemic).

OPERATING AND FINANCIAL HIGHLIGHTS

• Copa Holdings reported a net profit of US$114.4 million for the quarter or US$2.69 per share. Excluding special items, the Company would have reported a net profit of US$84.1 million or US$1.98 per share.  Special items include an US$8.9 million unrealized mark-to-market loss related to the Company's convertible notes and a reversal of US$39.2 million in the Company's provision related to the return of leased aircraft.
• Copa Holdings reported an operating profit of US$155.0 million for the quarter. Excluding the US$39.2 million reversal, the Company would have reported an operating profit of US$115.8 million and a 20.1% operating margin.
• For full-year 2021, the Company reported a net profit of US$39.9 million or US$0.94 per share. Excluding special items, which included a reversal of US$39.2 million in the Company's provision related to the return of leased aircraft, a US$22.8 million unrealized mark-to-market loss related to the Company's convertible notes, and a passenger revenue adjustment of US$20.8 million corresponding to unredeemed coupons from 2019 and 2020 sales, Copa Holdings would have reported an adjusted net profit of US$2.7 million or US$0.06 per share.
• For full-year 2021, the Company reported an operating profit of US$145.7 million. Excluding special items, the Company would have reported an operating profit of US$85.6 million and a 5.8% operating margin.
• Capacity for 4Q21, measured in terms of available seat miles (ASMs), was 83.1% of the capacity flown in 4Q19.
• Total revenues for 4Q21 came in at US$575.0 million, reaching 84.3% of 4Q19 revenues. Passenger revenues for 4Q21 reached 82.2% of 4Q19 levels, while 4Q21 cargo revenues were 61.2% higher than 4Q19. Passenger yield increased 1.0% to 12.7 cents and load factors decreased 1.8 percentage points to 83.5%, compared to 4Q19. Revenue per Available Seat Mile (RASM) came in at 11.3 cents, or 1.5% higher than 4Q19.  
• Operating cost per available seat mile (CASM) in 4Q21, excluding special items (adjusted CASM) decreased 3.8% vs. 4Q19 to 9.0 cents. While adjusted CASM, excluding fuel, decreased 7.5% to 6.1 cents.
• Cash buildup, defined as cash proceeds minus disbursements, excluding extraordinary financing activities and asset sales but including capital expenditures and payment of financial obligations, was US$84 million for the quarter.
• The Company ended the quarter with US$1.5 billion in available liquidity, consisting of approximately US$1.2 billion in cash, short-term and long-term investments, and US$295 million in committed and undrawn credit facilities.
• The Company closed the quarter with total debt, including lease liabilities, of US$1.6 billion.
• During the quarter, the Company took delivery of one Boeing 737 MAX 9, completed the conversion of one Boeing 737-800 into a freighter, and decided to retain three Boeing 737-700s previously classified as assets held for sale.
• Including 3 Boeing 737-700 aircraft currently in temporary storage and one Boeing 737-800 freighter, Copa Holdings ended the year with a consolidated fleet of 91 aircraft – 68 Boeing 737-800s, 14 Boeing 737 MAX 9s, and 9 Boeing 737-700s, compared to a fleet of 102 aircraft prior to the COVID-19 pandemic.
• Copa Airlines had an on-time performance for the quarter of 90.0% and a flight completion factor of 99.54%, once again positioning the airline among the best in the industry.

Subsequent Events

• In January, Copa Airlines was recognized by Cirium – for the eighth consecutive year – as the most on-time airline in Latin America in 2021. Copa Airlines' on-time performance of 91.1% for the year was the highest of any carrier in the Americas.
• In January, the Company took delivery of one Boeing 737 MAX 9 aircraft, originally scheduled for December 2021.
• Due to the recent surge in COVID-19 cases in Panama and Latin America, mainly driven by the Omicron variant, which impacted its crew availability, the Company canceled over 1,000 flights, reducing the 1Q22 published schedule by approximately 4%.

 

Consolidated Financial & Operating Highlights	4Q21	4Q19 (3)	Variance vs. 4Q19	3Q21	Variance vs. 3Q21	FY21	FY19 (3)	Variance vs. FY19
Revenue Passengers Carried (000s)	2,214	2,633	-15.9%	1,823	21.5%	6,136	10,474	-41.4%
Revenue Passengers OnBoard (000)	3,369	3,838	-12.2%	2,852	18.1%	9,452	15,424	-38.7%
RPMs (millions)	4,265	5,244	-18.7%	3,485	22.4%	11,734	21,303	-44.9%
ASMs (millions)	5,109	6,149	-16.9%	4,396	16.2%	14,934	25,113	-40.5%
Load Factor	83.5%	85.3%	-1.8 p.p.	79.3%	4.2 p.p.	78.6%	84.8%	-6.3 p.p.
Yield (US$ Cents)	12.7	12.5	1.0%	12.0	5.8%	12.0	12.3	-1.9%
PRASM (US$ Cents)	10.6	10.7	-1.1%	9.5	11.4%	9.5	10.4	-9.1%
RASM (US$ Cents)	11.3	11.1	1.5%	10.1	11.2%	10.1	10.8	-6.2%
CASM (US$ Cents)	8.2	10.8	-23.9%	8.8	-6.4%	9.1	9.4	-2.8%
Adjusted CASM (US$ Cents) (1)	9.0	9.3	-3.8%	8.8	2.4%	9.4	9.0	3.9%
CASM Excl. Fuel (US$ Cents)	5.3	8.0	-33.8%	6.2	-14.7%	6.6	6.6	-0.9%
Adjusted CASM Excl. Fuel (US$ Cents) (1)	6.1	6.6	-7.5%	6.2	-2.4%	6.8	6.3	8.9%
Fuel Gallons Consumed (millions)	61.0	78.9	-22.8%	52.0	17.1%	177.4	321.4	-44.8%
Avg. Price Per Fuel Gallon (US$)	2.43	2.16	12.5%	2.13	13.8%	2.14	2.16	-0.6%
Average Length of Haul (miles)	1,926	1,992	-3.3%	1,912	0.7%	1,912	2,034	-6.0%
Average Stage Length (miles)	1,254	1,279	-2.0%	1,213	3.4%	1,230	1,288	-4.5%
Departures	25,458	32,441	-21.5%	22,559	12.9%	75,755	131,819	-42.5%
Block Hours	80,710	105,620	-23.6%	69,308	16.5%	235,295	431,749	-45.5%
Average Aircraft Utilization (Hours) (2)	11.3	11.3	0.8%	10.7	6.4%	9.2	11.4	-19.7%
Operating Revenues (US$ millions)	575.0	681.9	-15.7%	445.0	29.2%	1509.9	2707.4	-44.2%
Operating Profit (Loss) (US$ millions)	155.0	17.8	770.5%	59.0	162.6%	145.7	346.2	-57.9%
Adjusted Operating Profit (Loss) (US$ millions) (1)	115.8	107.1	8.0%	48.6	138.1%	85.6	435.5	-80.3%
Operating Margin	27.0%	2.6%	24.3 p.p.	13.3%	13.7 p.p.	9.6%	12.8%	-3.1 p.p.
Adjusted Operating Margin (1)	20.1%	15.7%	4.4 p.p.	11.2%	8.9 p.p.	5.8%	16.1%	-10.3 p.p.
Net Profit (Loss) (US$ millions)	114.4	2.7	4092.8%	8.2	1287.5%	39.9	247.0	-83.8%
Adjusted Net Profit (Loss) (US$ millions) (1)	84.1	92.1	-8.7%	29.9	180.8%	2.7	336.3	-99.2%
Basic EPS (US$)	2.69	0.06	4088.2%	0.19	1291.3%	0.94	5.81	-83.8%
Adjusted Basic EPS (US$) (1)	1.98	2.17	-8.8%	0.70	181.6%	0.06	7.92	-99.2%
Shares  for calculation of Basic EPS (000s)	42,533	42,487	0.1%	42,649	-0.3%	42,533	42,487	0.1%
(1)  Excludes Special Items.  This earnings release includes a reconciliation of non-IFRS financial measures to the comparable IFRS measures. (2)  Average Aircraft Utilization is calculated based on the Company's active fleet, excluding aircraft in storage as well as those classified as assets held for sale. (3)  The Company believes that comparisons with 2019 are more relevant than year-over-year comparisons due to the significant impacts in 2020 of the COVID-19 pandemic.

 

FULL 4Q21 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT:

https://copa.gcs-web.com/financial-information/quarterly-results

4Q21 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST

Date:	February 10, 2021
Time:	11:00 AM US ET (11:00 AM Local Time)
Conference telephone number:	877-293-5456 (US Domestic Callers)
	707-287-9357 (International Callers)
Webcast:	https://copa.gcs-web.com/events-and-presentations
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		%
		4Q21		4Q19		Change	3Q21		Change	FY21		FY19		Change
Operating Revenues
Passenger revenue		540,571		657,940		-17.8%	417,466		29.5%	1,412,390		2,612,605		-45.9%
Cargo and mail revenue		25,849		16,033		61.2%	21,082		22.6%	71,577		62,460		14.6%
Other operating revenue		8,575		7,955		7.8%	6,451		32.9%	25,964		32,343		-19.7%
Total Operating Revenue		574,995		681,927		-15.7%	444,999		29.2%	1,509,930		2,707,409		-44.2%
Operating Expenses
Fuel		149,057		171,314		-13.0%	112,658		32.3%	383,179		696,249		-45.0%
Wages, salaries, benefits and other employees' expenses		80,434		115,036		-30.1%	68,049		18.2%	258,128		450,438		-42.7%
Passenger servicing		12,204		24,798		-50.8%	10,576		15.4%	35,869		102,103		-64.9%
Airport facilities and handling charges		42,863		44,877		-4.5%	39,407		8.8%	131,335		181,959		-27.8%
Sales and distribution		43,706		53,222		-17.9%	36,077		21.1%	129,877		210,623		-38.3%
Maintenance, materials and repairs		(13,317)		37,648		-135.4%	24,008		-155.5%	48,191		127,562		-62.2%
Depreciation and amortization		59,828		70,478		-15.1%	55,702		7.4%	234,505		282,080		-16.9%
Flight operations		19,173		24,908		-23.0%	16,291		17.7%	55,766		102,806		-45.8%
Other operating and administrative expenses		26,057		32,506		-19.8%	23,222		12.2%	87,426		118,090		-26.0%
Fleet Impairment		-		89,334		-100.0%	-		0.0%	-		89,344		-100.0%
Total Operating Expense		420,005		664,123		-36.8%	385,989		8.8%	1,364,276		2,361,255		-42.2%
Operating Profit (Loss)		154,989		17,804		770.5%	59,010		162.6%	145,655		346,154		-57.9%
Non-operating Income (Expense)
Finance cost		(18,994)		(17,154)		10.7%	(18,615)		2.0%	(74,051)		(57,432)		28.9%
Finance income		2,571		6,289		-59.1%	2,679		-4.0%	10,849		24,405		-55.5%
Gain (loss) on foreign currency fluctuations		(2,508)		2,406		-204.3%	(2,620)		-4.3%	(6,174)		(15,408)		-59.9%
Net change in fair value of derivatives		(8,922)		-		-100.0%	(32,092)		-72.2%	(22,778)		-
Other non-operating income (expense)		(1,158)		(989)		17.1%	(1,573)		-26.4%	(3,291)		(4,279)		-23.1%
Total Non-Operating Income/(Expense)		(29,011)		(9,448)		207.1%	(52,220)		-44.4%	(95,445)		(52,715)		81.1%
Profit (Loss) before taxes		125,978		8,356		1407.6%	6,790		1755.4%	50,209		293,439		-82.9%
Income tax expense		(11,616)		(5,629)		106.4%	1,453		-899.7%	10,265		46,437		-77.9%
Net Profit (Loss)		114,363		2,728		4092.8%	8,242		1287.5%	39,945		247,002		-83.8%
EPS
Basic		2.69		0.06		4088.2%	0.19		1291.3%	0.94		5.81		-83.8%
Shares used for calculation:
Basic		42,533,036		42,486,717			42,649,175			42,533,036		42,486,717

 

Copa Holdings, S. A. and subsidiaries
Consolidated statement of financial position
(US$ Thousands)
	December 2021	December 2020
ASSETS	(Unaudited)	(Audited)
Current Assets
Cash and cash equivalents	211,081	119,065
Short-term investments	806,340	770,816
Total cash, cash equivalents and short-term investments	1,017,421	889,881
Accounts receivable, net	90,618	63,206
Accounts receivable from related parties	1,832	1,429
Expendable parts and supplies, net	74,778	74,319
Prepaid expenses	31,148	30,473
Prepaid income tax	882	16,716
Other current assets	6,054	7,805
	205,312	193,948
Asset held for sale	-	135,542
TOTAL CURRENT ASSETS	1,222,733	1,219,371
Long-term investments	199,670	119,617
Long-term accounts receivable	(0)	1,054
Long-term prepaid expenses	22,783	6,066
Property and equipment, net	2,512,704	2,147,486
Right of use assets	166,328	214,279
Intangible, net	81,749	95,568
Deferred tax assets	28,417	35,595
Other Non-Current Assets	14,098	14,348
TOTAL NON-CURRENT ASSETS	3,025,749	2,634,013
TOTAL ASSETS	4,248,482	3,853,385
LIABILITIES
Loans and borrowings	196,602	127,946
Current portion of lease liability	73,917	83,605
Accounts payable	112,596	63,461
Accounts payable to related parties	7,948	2,970
Air traffic liability	557,331	470,695
Frequent flyer deferred revenue	95,114	91,213
Taxes Payable	32,599	13,400
Employee benefits obligations	32,767	33,995
Income tax payable	3,835	1,023
Other Current Liabilities	785	252
TOTAL CURRENT LIABILITIES	1,113,493	888,560
Loans and borrowings long-term	1,229,031	1,035,954
Lease Liability	104,734	146,905
Net Defined Benefit Liability	7,670	14,332
Derivative financial instruments	268,338	245,560
Deferred tax Liabilities	18,782	22,190
Other long - term liabilities	210,933	216,325
TOTAL NON-CURRENT LIABILITIES	1,839,487	1,681,265
TOTAL LIABILITIES	2,952,981	2,569,824
EQUITY
Issued Capital
Class A - 33,998,654  issued and 30,995,120 outstanding	21,290	21,199
Class B - 10,938,125	7,466	7,466
Additional Paid-In Capital	98,348	91,341
Treasury Stock	(176,902)	(136,388)
Retained Earnings	1,324,025	1,931,086
Net profit (loss)	39,945	(607,062)
Other comprehensive income (loss)	(18,670)	(24,082)
TOTAL EQUITY	1,295,501	1,283,561
TOTAL EQUITY LIABILITIES	4,248,482	3,853,385

Copa Holdings, S. A. and subsidiaries
Consolidated Statement of Cash Flows
For the twelve months ended December 31,
(In US$ thousands)
									2021		2020		2019
									(Unaudited)		(Audited)		(Audited)
Cash flow from (used in) operating activities									462,612		(39,515)		740,776
Cash flow used in investing activities									(373,040)		(93,761)		(192,868)
Cash flow from (used in) financing activities									2,444		93,609		(545,334)
Net increase (decrease) in cash and cash equivalents									92,016		(39,667)		2,574
Cash and cash equivalents at January 1									119,065		158,732		156,158
Cash and cash equivalents at December 31									$               211,081		$               119,065		$               158,732
Short-term investments									806,340		770,816		692,403
Long-term investments									199,670		119,617		134,347
Total cash and cash equivalents and investments at December 31									$            1,217,091		$            1,009,498		$               985,482

 

 

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, Operating CASM Excluding Fuel, and Cash Buildup. 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		4Q21		4Q20		3Q21		4Q19		FY21		FY19
Operating Profit as Reported		$   154,989		$   (95,057)		$     59,010		$     17,804		$   145,655		$   346,171
Subtract: Unredeemed Ticket Revenue provision reversal						$     10,395				$     20,790
Subtract: Leased Aircraft Return provision		$     39,217								$     39,217
Add: Fleet Impairment loss				$       4,400				$     89,344				$     89,344
Add: Expected loss (gain) on Embraer assets held for sale				$        (877)
Adjusted Operating Profit		$   115,773		$   (91,533)		$     48,615		$   107,148		$     85,648		$   435,515
Net Profit as Reported		$   114,363		$ (168,805)		$       8,242		$       2,728		$     39,945		$   247,002
Subtract: Unredeemed Ticket Revenue provision reversal						$     10,395				$     20,790
Subtract: Leased Aircraft Return provision		$     39,217								$     39,217
Add: Fleet Impairment loss				$       4,400				$     89,344				$     89,344
Add: Expected loss (gain) on Embraer assets held for sale				$        (877)
Add: Net change in fair value of derivatives		$       8,922		$     80,076		$     32,092				$     22,779
Adjusted Net Profit		$     84,068		$   (85,205)		$     29,939		$     92,072		$       2,717		$   336,346
Reconciliation of Adjusted Basic EPS		4Q21		4Q20		3Q21		4Q19		FY21		FY19
Adjusted Net Profit		$     84,068		$   (85,205)		$     29,939		$     92,072		$       2,717		$   336,346
Shares used for calculation of Basic EPS		42,533		42,511		42,649		42,487		42,508		42,478
Adjusted Basic Earnings per share (Adjusted Basic EPS)		$         1.98		$       (2.00)		$         0.70		$         2.17		$         0.06		$         7.92
Reconciliation of Adjusted Operating Costs per ASM
Excluding Fuel (Adjusted CASM Excl. Fuel)		4Q21				3Q21		4Q19		FY21		FY19
Operating Costs per ASM as Reported (in US$ Cents)		8.2				8.8		10.8		9.1		9.4
Return of leased aircraft provision per ASM (in US$ Cents)		(0.8)				-		-		(0.3)		-
Fleet Impairment per ASM (in US$ Cents)		-				-		1.5		-		0.4
Adjusted Operating Costs per ASM (in US$ Cents)		9.0				8.8		9.3		9.4		9.0
Aircraft Fuel Cost per ASM  (in US$ Cents)		2.9				2.6		2.8		2.6		2.8
Adjusted Operating Costs per ASM excluding fuel  (in US$ Cents)		6.1				6.2		6.6		6.8		6.3
Reconciliation of Monthly Cash Buildup (Burn) for 2021		4Q21		3Q21		2Q21		1Q21
Beginning Cash balance		$       1,289		$       1,282		$       1,203		$       1,009
Ending Cash balance		$       1,217		$       1,289		$       1,282		$       1,203
Net cashflows in the quarter		$          (72)		$              7		$            79		$          194
Subtract: Proceeds from Lines of Credit		$            50		$             -		$             -		$             -
Subtract: Net Proceeds from new Aircraft Financing minus Pre Delivery Payments		$        (181)		$          (57)		$          (21)		$          241
Subtract: Others proceeds (assets sold and other non-op proceeds)		$            14		$            11		$            36		$            20
Add: Share repurchase		$            39		$             -		$             -		$             -
Cash Buildup (Burn) excluding extraordinary activities		$            84		$            54		$            64		$          (68)

 

 

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SOURCE Copa Holdings, S.A.

FAQ

What were Copa Holdings' earnings for 4Q21?

Copa Holdings reported a net profit of US$114.4 million or US$2.69 per share for 4Q21.

How did Copa Holdings perform compared to 4Q19?

Copa's total revenues for 4Q21 were US$575.0 million, reaching 84.3% of 4Q19 revenues.

What is the financial outlook for Copa Holdings in 2022?

The company faced challenges due to COVID-19, canceling over 1,000 flights in January 2022.

What are the key financial metrics for Copa Holdings in FY21?

For FY21, Copa Holdings reported a net profit of US$39.9 million, down from US$247 million in FY19.