SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
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,
2007
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
Parque
Lefevre
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 o
(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
o No
x
(If
“Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b);82-
)
Copa
Holdings Reports Earnings of US$30.9 Million and EPS of US$0.71 for 2Q07
Panama
City, Panama
--- August 15, 2007. Copa Holdings, S.A. (NYSE: CPA), parent company of Copa
Airlines and Aero Republica, today announced financial results for the second
quarter of 2007 (2Q07). The terms “Copa Holdings" or "the Company" makes
reference to the consolidated entity, whose operating subsidiaries are Copa
Airlines and Aero Republica. The following financial and operating information,
unless otherwise indicated, is presented pursuant to US GAAP.
OPERATING
AND FINANCIAL HIGHLIGHTS
| · |
Copa
Holdings reported net earnings of US$30.9 million for 2Q07, representing
diluted earnings per share of US$0.71, a 33.3% year-over-year
increase.
|
| · |
EBITDAR
increased by 33.7% to US$61.7 million in 2Q07 from US$46.1 million
in
2Q06. This resulted in a 2.1 percentage point EBITDAR margin
increase,
from 24.1% in 2Q06 to 26.2% in 2Q07.
|
| · |
Operating
income for 2Q07 rose 37.0% to US$39.0 million from US$28.5 million
in
2Q06. Operating margin came in at 16.6%, an increase of 1.7 percentage
points above 2Q06.
|
| · |
Revenue
passenger miles (RPMs) increased 18.3% from 1.14 billion in 2Q06
to 1.35
billion in 2Q07. Available seat miles (ASMs) increased 15.3%
from 1.63
billion in 2Q06 to 1.88 billion in 2Q07. As a result, average
load factor
increased 1.8 percentage points to 71.6%.
|
| · |
Total
revenues increased to US$235.3 million, representing growth of
22.9%.
Passenger yield increased 4.1% to 16.4 cents and operating revenue
per
available seat mile (RASM) increased 6.6% to 12.5
cents.
|
| · |
Operating
cost per available seat mile (CASM) increased 4.5% from 10.0
cents in 2Q06
to 10.4 cents in 2Q07. CASM excluding fuel increased 8.0% from
6.7 cents
in 2Q06 to 7.3 cents in 2Q07.
|
| · |
For
2Q07, Copa Airlines reported an on-time performance of 87.8%
and a
flight-completion factor of 99.4%, again placing among the best
in the
industry.
|
| · |
In
May, Copa Airlines announced the acquisition of four new Boeing
737-800
aircraft and options for three more. Additionally, Aero Republica
recently
signed lease agreements with GECAS for two additional EMBRAER-190
aircraft
to be delivered in the second half of 2008. As a result, Copa
Airlines and Aero Republica now have firm orders for 22 aircraft
(9 Boeing
737 NGs / 13 EMBRAER-190s) and purchase rights and options for
38 aircraft
(8 Boeing 737 NGs / 30
EMBRAER-190s).
|
| · |
In
June, Copa Airlines began taking delivery of the total of seven
aircraft
scheduled to be delivered in 2007, having received three aircraft
consisting of two EMBRAER-190s and one Boeing 737-800. For the
remainder
of the year Copa expects to take delivery of four additional
aircraft - 3
EMBRAER-190s and a Boeing 737-800 -ending 2007 with a fleet of
37
aircraft.
|
| · |
On
July 13, Aero Republica began its second daily frequency from
Bogota to
Panama City. Aero Republica currently provides international
connectivity
into Copa Airlines’ Hub of the Americas from the Colombian cities of
Bogota, Cali, Cartagena and Medellin. Additionally, Aero Republica
will be
adding service from Bucaramanga, Colombia into Panama City in
October
2007.
|
| · |
On
July 15, Copa Airlines began service from its Hub of in Panama
City to
Washington D.C. and Punta Cana (Dominican Republic), as well
as
Guadalajara (Mexico) on July 18 and Cordoba (Argentina) on August
15. Copa
Airlines network currently serves 40 cities in 21 countries in
North,
South and Central America and the Caribbean.
|
| · |
On
July 16, an Aero Republica aircraft overran the runway on arrival
at the
Simon Bolivar International Airport in the city of Santa Marta,
Colombia.
No major injuries were sustained. The
aircraft involved in this incident, an EMBRAER-190 which entered
into
service on January 17, 2007, sustained considerable damage and
is
currently out of operation.
|
2
| · |
On
July 30, Copa Airlines announced a comprehensive code share
agreement with
AeroMexico which formally began on August 1, 2007. As part
of the
agreement, Copa Airlines has placed its designator code on
AeroMexico-operated flights beyond Mexico City to 17 Mexican
cities.
Additionally, AeroMexico has placed its designator code on
Copa
Airlines-operated flights between the Hub of the Americas in
Panama City
to Mexico City, Cancun and
Guadalajara.
|
|
Consolidated
Financial & Operating Highlights
|
2Q07
|
2Q06
|
%
Change
|
1Q07
|
%
Change
|
|
Revenue
Passenger Miles (RPM) (mm)
|
1,346
|
1,137
|
18.3%
|
1,427
|
-5.7%
|
|
Available
Seat Miles (ASM) (mm)
|
1,880
|
1,631
|
15.3%
|
1,868
|
0.6%
|
|
Load
Factor
|
71.6%
|
69.7%
|
1.8p.p.
|
76.4%
|
-4.8p.p.
|
|
Yield
|
16.4
|
15.8
|
4.1%
|
16.1
|
1.9%
|
|
Passenger
Revenue per ASM (US$ cents) (“PRASM”)
|
11.8
|
11.0
|
6.9%
|
12.3
|
-4.5%
|
|
Operating
Revenue per ASM (US$ cents) (“RASM”)
|
12.5
|
11.7
|
6.6%
|
13.0
|
-3.7%
|
|
Operating
Cost per ASM (US$ cents) (“CASM”)
|
10.4
|
10.0
|
4.5%
|
9.7
|
7.2%
|
|
Operating
Cost (excluding fuel) per ASM (US$ cents)
|
7.3
|
6.7
|
8.0%
|
6.7
|
7.7%
|
|
Breakeven
Load Factor
|
59.3%
|
58.6%
|
0.7p.p.
|
56.5%
|
2.8p.p.
|
|
Operating
Revenues (US$ mm)
|
235.3
|
191.5
|
22.9%
|
242.7
|
-3.1%
|
|
EBITDAR
(US$ mm) *
|
61.7
|
46.1
|
33.7%
|
79.5
|
-22.4%
|
|
EBITDAR
Margin *
|
26.2%
|
24.1%
|
2.1p.p.
|
32.8%
|
-6.5p.p.
|
|
Operating
Income (US$ mm)
|
39.0
|
28.5
|
37.0%
|
60.8
|
-35.9%
|
|
Operating
Margin
|
16.6%
|
14.9%
|
1.7p.p.
|
25.0%
|
-8.5p.p.
|
|
Net
Income (US$ mm)
|
30.9
|
22.9
|
35.2%
|
48.6
|
-36.4%
|
|
Net
Margin
|
13.1%
|
11.9%
|
1.2p.p.
|
20.0%
|
-6.9p.p.
|
|
Earnings
per Share - Basic (US$)
|
0.72
|
0.53
|
35.2%
|
1.13
|
-36.4%
|
|
Earnings
per Share - Diluted (US$)
|
0.71
|
0.53
|
33.3%
|
1.12
|
-36.5%
|
|
Weighted
Average Number of Shares - Basic (000)
|
42,817
|
42,813
|
0.0%
|
42,817
|
0.0%
|
|
Weighted
Average Number of Shares - Diluted (000)
|
43,502
|
42,895
|
1.4%
|
43,435
|
0.2%
|
*EBITDAR
(earnings before interest, taxes, depreciation, amortization and rent)
is
presented as supplemental information 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. However, EBITDAR
should not be considered in isolation, as a substitute for net income prepared
in accordance with US GAAP or as a measure of a company’s profitability. In
addition, our calculations may not be comparable to other similarly titled
measures of other companies. A reconciliation of EBITDAR to consolidated
net
income is attached to this press release.
MANAGEMENT’S
COMMENTS ON 2Q07 RESULTS
For
the
second quarter, Copa Holdings experienced a 22.9% or US$43.8 million
year-over-year increase in operating revenues, driven mainly by a 19.4%
or
US$29.9 million increase in Copa Airlines operating revenues and a 39.4%
or
US$14.7 million increase in Aero Republica operating revenues. Revenues
per
available seat mile increased 6.6% year-over-year, benefiting from higher
consolidated yields and load factors.
Copa
Airlines continued to be the main driver of capacity growth, increasing
by 20%,
while load factors increased 0.7 percentage points year-over-year to 76.7%
during its low-season quarter. Aero Republica also recorded a 2.2 percentage
point increase in load factor on a 0.7% increase in capacity.
3
On
a
consolidated level, yields increased 4.1% year-over-year. The main driver
of
these yield gains came from Aero Republica where the strength of the Colombian
Peso, revenue management initiatives and increased yield-enhancing international
flights delivered a 29.4% increase in yields. Copa Airlines yields experienced
a
1.0% year-over-year decline as a result of a longer length of haul as well
as
competitive pressures in some markets. However, on a length of haul adjusted
basis, Copa Airlines yields increased 1% year-over-year.
Operating
costs for the quarter increased 20.4% or US$33.3 million, driven mostly
as a
result of increased capacity and the impact of a stronger Colombian currency
against the US dollar. Total unit cost, as measured by operating cost per
available seat mile, increased 4.5% to 10.4 cents. Excluding fuel expense,
unit
costs increased 8.0% to 7.3 cents, mostly driven by Aero Republica, where
ex-fuel unit costs increased by 28.3%, primarily as a result of a stronger
Colombian currency.
Consolidated
earnings before interest, taxes, depreciation, amortization and rents
("EBITDAR") rose 33.7% to US$61.7 million from US$46.1 million in 2Q06.
EBITDAR
margins increased by 2.1 percentage points to 26.2%. Operating income rose
37.0%
to US$39.0 million in 2Q07 from US$28.5 million in 2Q06, while operating
margins
increased 1.7 percentage points to 16.6%.
The
Company maintains a strong liquidity position, ending the quarter with
US$272.0
million in cash, cash equivalents, short-term and long-term investments,
as well
as approximately US$34.5 million in committed credit lines. Total debt
amounted
to US$724.2 million, which relates for the most part to aircraft and equipment
financing.
Looking
forward to the remainder of 2007, we expect healthy demand to continue
into both
Copa Airlines’ and Aero Republica’s seasonally strong second half of the year.
This is evidenced by the recently released July traffic figures, where
consolidated load factors registered a 1.8 percentage point increase on
a 17%
capacity increase. We expect Copa Airlines to continue experiencing increased
yield pressure in the second half of the year as a result of introductory
fares
to promote new destinations as well as a more competitive fare environment.
Nevertheless, we will continue to focus on maximizing unit revenues and
capitalizing on the competitive advantages of having the most extensive
and
convenient intra-Latin American network.
On
the
operational front, continued global demand for pilots presents a challenge
with
respect to the hiring and retention of the necessary crews to support planned
capacity deployment. This will result in more moderate growth for Copa
Airlines
in 2007 where, as a result of operational changes, full year capacity growth
will be reduced from the originally forecasted 25% to approximately 21%.
Additionally, Aero Republica’s full year capacity growth is expected to be in
the range of 3%, down from the previously forecasted 5%, mainly due to
operational changes resulting from the loss of an EMBRAER-190 aircraft
in the
month of July.
During
the third quarter, Copa Airlines added to its network four of the new markets
planned for 2007, in addition to increased frequencies to key markets.
These new
destinations and frequencies, along with capacity added during the second
half
of 2006, will drive Copa Airlines’ full year capacity growth. To carry on this
growth, Copa Airlines has already received three of the seven aircraft
scheduled
for delivery in 2007.
For
2Q07,
Aero Republica recorded operating income of US$2.8 million, a significant
improvement over the US$4.8 million operating loss it recorded in 2Q06.
Despite
the short term setback regarding the loss of one of its new EMBRAER-190
aircraft, the airline continues on track in the execution of their its
transition plan and will be receiving an additional four EMBRAER-190s during
the
second half of 2007, to end the year with a fleet of seven EMBRAER-190’s and six
MD-80’s.
Additionally,
Aero Republica continues to increase its international connectivity with
Copa
Airlines’ Hub of the Americas. Aero Republica now feeds Copa Airlines’ Hub from
four of Colombia’s most important cities, recently adding a second daily flight
from Bogota. Aero Republica will further increase connectivity into Copa
Airlines’ hub in October when it begins new service from the city of
Bucaramanga, Colombia.
4
During
the second half of 2007, we expect to face some challenges with respect
to pilot
recruitment that have moderately tempered our capacity growth plans for 2007.
This issue, along with some added competition that is pressuring yields
has led
us to revise slightly downward our full year 2007 guidance. Nevertheless,
we
anticipate continued strength in demand for travel in the region, enhanced
by
the growing preference of our network and product as the preferred choice
for
intra-Latin American travel. Copa Airlines will maintain its focus on setting
the stage for sustained growth and profitability through rational fleet
and
network expansion, with emphasis on cost-control and delivering a world-class
product.
CONSOLIDATED
SECOND QUARTER RESULTS
Operating
revenue
Consolidated
revenue for 2Q07 totaled US$235.3 million, a 22.9% or US$43.8 million
increase over operating revenue of US$191.5 million in 2Q06, due to a 19.4%
or US$29.9 million increase in Copa Airlines’ operating revenue and a 39.4% or
US$14.7 million increase in Aero Republica’s operating revenue.
Copa
Airlines operating revenue
Copa
Airlines operating revenue for 2Q07 totaled US$184.1 million, a 19.4%
increase over operating revenue of US$154.2 million in 2Q06. This increase
was primarily due to a 20.0% increase in passenger revenue.
Passenger
revenue. For
2Q07
passenger revenue totaled US$172.5 million a 20.0% increase over passenger
revenue of US$143.8 million in 2Q06. This increase resulted from growth in
capacity (ASMs increased by 20% in 2Q07 as compared to 2Q06) and a higher
load
factor (load factor increased from 76.0% in 2Q06 to 76.7% in 2Q07), which
was
partially offset by a 1% decline in passenger yield, which stood at 15.2
cents.
Cargo,
mail and other. Cargo,
mail and other totaled US$11.5 million in 2Q07, an 11% increase over cargo,
mail
and other of US$10.4 million in 2Q06.
Aero
Republica operating revenue
During
2Q07, Aero Republica generated operating revenue of US$52.1 million,
representing a 39.4% or US$14.7 million increase over 2Q06. This increase
resulted mainly from a US$12.9 million or 36.1% increase in passenger revenue.
During the quarter Aero Republica’s capacity (ASMs) increased by 0.7%, while
traffic (RPMs) increased by 5.2%, representing a load factor of 52.6% or
2.2
percentage points above 2Q06. Yields increased by 29.4% primarily due to
the
strengthening of the Colombian currency.
Operating
expenses
For
2Q07,
consolidated operating expenses totaled US$196.3 million, a 20.4% increase
over
operating expenses of US$163.0 million for 2Q06. Operating cost per
available seat mile (CASM) increased 4.5% from 10.0 cents in 2Q06 to 10.4
cents
in 2Q07. An overview of the major variances on a consolidated basis
follows:
Aircraft
fuel. For
2Q07,
aircraft fuel totaled US$59.7 million, a US$6.4 million or 12.0% increase
over aircraft fuel of US$53.3 million in 2Q06. This increase was primarily
a result of a 13.0% increase in gallons consumed resulting from increased
capacity, partly offset by a 0.8% decrease in the average price per gallon
of
jet fuel (all-in), which net of hedges averaged US$2.22 in 2Q07 vs. US$2.24
in
2Q06.
5
Salaries
and benefits. For
2Q07,
salaries and benefits totaled US$28.8 million, a 34.6% increase over
salaries and benefits of US$21.4 million in 2Q06. This was mainly a result
of an
overall increase in operating headcount to support additional capacity,
increased profit sharing expenses and the effect of the Colombian currency
appreciation.
Passenger
servicing. For
2Q07,
passenger servicing totaled US$19.0 million, a 30.4% increase over
passenger servicing of US$14.6 million in 2Q06. This increase was primarily
a
result of an increase in capacity and the number of passengers
carried.
Commissions.
For
2Q07,
commissions totaled US$16.8 million, a 24.0% increase over commissions
of
US$13.6 million in 2Q06. This increase was primarily a result of higher
passenger revenue and the effect of the Colombian currency
appreciation.
Reservations
and sales.
Reservations
and sales totaled US$12.1 million, a 25.0% increase over reservation and
sales
of US$9.7 million in 2Q06. This increase was primarily a result of more
passengers carried and higher GDS fees.
Maintenance,
material and repairs. For
2Q07,
maintenance, material and repairs totaled US$13.3 million, a 10.2% increase
over
maintenance, material and repairs of US$12.1 million in 2Q06. This increase
was primarily a result of increased capacity and more major airframe overhaul
events at Copa Airlines, partially offset by the timing of major overhaul
events
at Aero Republica.
Depreciation.
Depreciation
totaled US$8.5 million in 2Q07, a 53.7% increase over depreciation of
US$5.5 million in 2Q06. This increase was primarily related to the
depreciation of new aircraft and spares.
Aircraft
rentals. For
2Q07,
aircraft rentals totaled US$9.3 million, a 4.7% increase over aircraft
rentals
of US$8.9 million in 2Q06.
Flight
operations,
landing
fees and other rentals.
Combined
flight operations, landing fees and other rentals increased 20.0% from
US$16.2
million in 2Q06 to US$13.5 million in 2Q07, primarily as a result of
increased capacity.
Other.
Other
expenses totaled US$12.5 million in 2Q07, an increase of 20.1% over US$10.4
million in 2Q06, mostly related to additional capacity and certain Aero
Republica initiatives.
Copa
Airlines operating expenses
Copa
Airlines’ operating expenses increased 22.5% to US$148.1 million from US$120.9
million in 2Q06. Operating expenses per available seat mile increased 2.1%
to
10.0 cents in 2Q07 from 9.8 cents in 2Q06. Excluding fuel costs, operating
expenses per available seat mile increased 3.6% from 6.8 cents in 2Q06
to 7.1
cents in 2Q07.
Aircraft
fuel.
For
2Q07,
aircraft fuel totaled US$43.9 million, an 18.5% increase over aircraft fuel
expense of US$37.0 million in the same period in 2006. This increase was
primarily a result of a 20.3% increase in gallons consumed resulting from
increased capacity, offset by a 1.1% decrease in the average price per
gallon of
jet fuel (all-in), which net of hedges averaged US$2.17 in 2Q07 vs. US$2.19
in
2Q06.
Salaries
and benefits.
For
2Q07,
salaries and benefits totaled US$22.6 million, a 28.8% increase over
salaries and benefits of US$17.5 million in the same period in 2006. This
increase was mainly a result of an overall increase in operating headcount
to
support additional capacity, increased profit sharing expenses and incremental
pilot benefit costs.
Passenger
servicing.
Passenger
servicing totaled US$15.7 million for 2Q07, a 29.0% increase over passenger
servicing of US$12.2 million in 2Q06. This increase was primarily a result
of an increase in carried passengers.
Commissions.
Commissions
totaled US$11.6 million for 2Q07, an 18.6% increase over commissions of
US$9.8 million in 2Q06. This increase was primarily a result of a 20.0%
increase
in passenger revenue, partially offset by a lower average commission rate.
Reservations
and sales.
Reservations
and sales totaled US$8.5 million, a 5.6% increase over reservation and
sales of
US$8.1 million in 2Q06. This increase was primarily a result of more passengers
carried.
6
Maintenance,
materials and repairs.
Maintenance,
materials and repairs totaled US$9.7 million in 2Q07, a 57.5% increase over
maintenance, materials and repairs of US$6.2 million in 2Q06. This increase
resulted from higher capacity and more major airframe overhaul events during
the
period.
Depreciation.
Depreciation
totaled US$7.2 million in 2Q07, a 35.6% increase over depreciation of
US$5.3 million in 2Q06. This increase was primarily related to depreciation
of new aircraft and spares.
Aircraft
rentals. Aircraft
rentals totaled US$6.9 million in 2Q07, a 15.6% increase over aircraft
rentals in 2Q06. This increase mainly resulted from the wet lease of an
Aero
Republica aircraft.
Flight
operations,
landing
fees and other rentals.
Combined,
flight operations, landing fees and other rentals increased 17.1% from
US$11.0
million in 2Q06 to US$12.9 million in 2Q07, primarily as a result of
higher capacity.
Other.
Other
expenses totaled US$9.1 million in 2Q07, a 15.6% or US$1.2 million increase
over other expenses in 2Q06.
Aero
Republica operating expenses
Aero
Republica’s operating expenses increased 16.8% to US$49.2 million in 2Q07 from
US$42.2 million in 2Q06. Operating expenses per available seat mile increased
16% to 12.3 cents in 2Q07 from 10.6 cents in 2Q06. Excluding fuel costs,
operating expenses per available seat mile increased 28.3% from 6.5 cents
in
2Q06 to 8.3 cents in 2Q07, mainly driven by a stronger Colombian currency
against the US$ dollar.
Non-operating
income (expense)
Consolidated
non-operating expenses totaled US$4.3 million in 2Q07, a 10.6% decrease
over non-operating expenses of US$3.8 million in 2Q06.
Interest
expense.
Interest expense totaled US$10.4 million in 2Q07, a 55.2% increase over
interest
expense of US$6.7 million in 2Q06, mostly as a result of increased aircraft
related debt.
Interest
capitalized.
Interest capitalized totaled US$0.7 million in 2Q07, a 33.8% increase over
interest capitalized of US$0.6 million in 2Q06.
Interest
income. Interest
income totaled US$3.0 million, a 93.1% increase over interest income of
US$1.6
million in 2Q06, mostly a result of increased cash, cash equivalents and
investments.
Other,
net. Other
net
totaled US$2.4 million in 2Q07, this balance includes a US$2.6 Million
Copa
Airlines fuel hedge mark-to-market gain and a US$4.8 Million Aero Republica
mark-to-market loss as a result of currency forward contracts to hedge
exposure
to the Colombian currency.
OUTLOOK
FOR 2007
Based
on
2Q07 results and our current expectations for the second half of 2007,
we are
revising our 2007 full year guidance as follows:
|
Financial
Outlook (US GAAP)
|
2007
- Full Year
Prior
|
2007
- Full Year
Revised
|
|
ASMs
(billion)
|
+/-
8.2
|
+/-
8.0
|
|
Average
Load Factor
|
+/-
75%
|
+/-
75%
|
|
RASM
(cents)
|
+/-
12.8
|
+/-
12.6
|
|
CASM
Ex-fuel (cents)
|
+/-
6.8
|
+/-
6.9
|
|
Operating
Margin
|
20.5%
- 22%
|
19.5%
- 21%
|
7
About
Copa Holdings
Copa
Holdings, through its Copa Airlines and Aero Republica operating subsidiaries,
is a leading Latin American provider of international airline passenger
and
cargo service. Copa Airlines currently offers approximately 116 daily scheduled
flights to 40 destinations in 21 countries in North, Central and South
America
and the Caribbean. In addition, Copa Airlines provides passengers with
access to flights to more than 120 other international destinations through
code
share agreements with Continental Airlines and other airlines. Aero Republica,
the second-largest domestic carrier in Colombia, provides service to 12
cities
in Colombia as well as international connectivity with Copa Airlines’ Hub of the
Americas through flights from Bogota, Cali, Cartagena and Medellin.
CONTACT:
Copa
Holdings S.A.
Investor
Relations:
Ph:
(507) 304-2677
e-mail:
investorrelations@copaair.com
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 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.
8
|
Operating
data
|
|||||
|
US
GAAP - Unaudited
|
|
Unaudited
2Q07
|
Unaudited
2Q06
|
%
Change
|
Unaudited
1Q07
|
%
Change
|
|
|
Copa
Holdings (Consolidated)
|
|||||
|
Revenue
passengers carried (thousands)
|
1,107
|
1,026
|
7.9%
|
1,121
|
-1.3%
|
|
Revenue
passengers miles (RPMs) (mm)
|
1,346
|
1,137
|
18.3%
|
1,427
|
-5.7%
|
|
Available
seat miles (ASMs) (mm)
|
1,880
|
1,631
|
15.3%
|
1,868
|
0.6%
|
|
Load
factor
|
71.6%
|
69.7%
|
1.8
p.p.
|
76.4%
|
-4.8
p.p.
|
|
Break-even
load factor
|
59.3%
|
58.6%
|
0.7
p.p.
|
56.5%
|
2.8
p.p.
|
|
Yield
(US$ cents)
|
16.4
|
15.8
|
4.1%
|
16.1
|
1.9%
|
|
Operating
revenue per ASM (US$ cents) (RASM)
|
12.5
|
11.7
|
6.6%
|
13.0
|
-3.7%
|
|
Operating
expenses per ASM (US$ cents) (CASM)
|
10.4
|
10.0
|
4.5%
|
9.7
|
7.2%
|
|
Operating
Cost (excluding fuel) per ASM (US$ cents)
|
7.3
|
6.7
|
8.0%
|
6.7
|
7.7%
|
|
Fuel
gallons consumed (mm)
|
26.6
|
23.5
|
13.0%
|
26.5
|
0.3%
|
|
Average
price of Fuel - Net of Hedges (US$)
|
2.22
|
2.24
|
-0.8%
|
2.09
|
6.3%
|
|
|
|||||
|
Copa
Segment
|
|
||||
|
Revenue
passengers miles (RPMs) (mm)
|
1,134
|
936
|
21.1%
|
1,209
|
-6.2%
|
|
Available
seat miles (ASMs) (mm)
|
1,478
|
1,232
|
20.0%
|
1,468
|
0.7%
|
|
Load
factor
|
76.7%
|
76.0%
|
0.7
p.p.
|
82.4%
|
-5.6
p.p.
|
|
Break-even
load factor
|
58.6%
|
56.3%
|
2.3
p.p.
|
55.9%
|
2.7
p.p.
|
|
Yield
(US$ cents)
|
15.2
|
15.4
|
-1.0%
|
15.4
|
-0.9%
|
|
Operating
revenue per ASM (US$ cents) (RASM)
|
12.5
|
12.5
|
-0.5%
|
13.4
|
-7.1%
|
|
Operating
expenses per ASM (US$ cents) (CASM)
|
10.0
|
9.8
|
2.1%
|
9.5
|
5.3%
|
|
Operating
Cost (excluding fuel) per ASM (US$ cents)
|
7.1
|
6.8
|
3.6%
|
7.1
|
0.0%
|
|
Fuel
gallons consumed (mm)
|
19.9
|
16.5
|
20.3%
|
19.9
|
-0.1%
|
|
Average
price of Fuel - Net of Hedges (US$)
|
2.17
|
2.19
|
-1.1%
|
2.09
|
3.7%
|
|
AeroRepublica
Segment
|
|
||||
|
Revenue
passengers miles (RPMs) (mm)
|
211
|
201
|
5.2%
|
218
|
-3.1%
|
|
Available
seat miles (ASMs) (mm)
|
401
|
398
|
0.7%
|
400
|
0.3%
|
|
Load
factor
|
52.6%
|
50.4%
|
2.2
p.p.
|
54.4%
|
-1.8
p.p.
|
|
Break-even
load factor
|
54.7%
|
62.9%
|
-8.2
p.p.
|
54.3%
|
0.4
p.p.
|
|
Yield
(US$ cents)
|
23.1
|
17.8
|
29.4%
|
20.5
|
12.6%
|
|
Operating
revenue per ASM (US$ cents) (RASM)
|
13.0
|
9.4
|
38.4%
|
11.8
|
10.4%
|
|
Operating
expenses per ASM (US$ cents) (CASM)
|
12.3
|
10.6
|
16.0%
|
10.8
|
13.9%
|
|
Operating
Cost (excluding fuel) per ASM (US$ cents)
|
8.3
|
6.5
|
28.3%
|
7.4
|
13.1%
|
|
Fuel
gallons consumed (mm)
|
6.7
|
7.0
|
-4.3%
|
6.6
|
1.4%
|
|
Average
price of Fuel - Net of Hedges (US$)
|
2.37
|
2.34
|
1.3%
|
2.08
|
14.0%
|
9
|
Income
Statement - USGAAP
|
|||||
|
(US$
Thousands)
|
|
Unaudited
2Q07
|
Unaudited
2Q06
|
%
Change
|
Unaudited
1Q07
|
%
Change
|
|
|
Operating
Revenues
|
|||||
|
Passenger
Revenue
|
221,221
|
179,575
|
23.2%
|
230,271
|
-3.9%
|
|
Cargo,
mail and other
|
14,073
|
11,890
|
18.4%
|
12,479
|
12.8%
|
|
Total
Operating Revenue
|
235,294
|
191,465
|
22.9%
|
242,750
|
-3.1%
|
|
|
|
|
|||
|
Operating
Expenses
|
|
|
|||
|
Aircraft
fuel
|
59,711
|
53,327
|
12.0%
|
55,912
|
6.8%
|
|
Salaries
and benefits
|
28,789
|
21,395
|
34.6%
|
26,749
|
7.6%
|
|
Passenger
servicing
|
19,020
|
14,589
|
30.4%
|
17,932
|
6.1%
|
|
Commissions
|
16,809
|
13,558
|
24.0%
|
14,813
|
13.5%
|
|
Reservations
and sales
|
12,143
|
9,711
|
25.0%
|
10,997
|
10.4%
|
|
Maintenance,
material and repairs
|
13,355
|
12,117
|
10.2%
|
11,134
|
19.9%
|
|
Depreciation
|
8,455
|
5,502
|
53.7%
|
7,995
|
5.8%
|
|
Flight
operations
|
9,912
|
7,751
|
27.9%
|
9,410
|
5.3%
|
|
Aircraft
rentals
|
9,303
|
8,886
|
4.7%
|
9,163
|
1.5%
|
|
Landing
fees and other rentals
|
6,314
|
5,770
|
9.4%
|
6,256
|
0.9%
|
|
Other
|
12,483
|
10,392
|
20.1%
|
11,590
|
7.7%
|
|
Total
Operating Expense
|
196,295
|
162,998
|
20.4%
|
181,951
|
7.9%
|
|
|
|
|
|||
|
Operating
Income
|
38,999
|
28,467
|
37.0%
|
60,799
|
-35.9%
|
|
|
|
|
|||
|
Non-operating
Income (Expense):
|
|
|
|||
|
Interest
expense
|
(10,393)
|
(6,698)
|
55.2%
|
(9,848)
|
5.5%
|
|
Interest
capitalized
|
736
|
550
|
33.8%
|
531
|
38.6%
|
|
Interest
income
|
3,031
|
1,570
|
93.1%
|
2,542
|
19.2%
|
|
Other,
net
|
2,373
|
732
|
224.2%
|
(1,097)
|
-316.3%
|
|
Total
Non-Operating Income/(Expense)
|
(4,253)
|
(3,846)
|
10.6%
|
(7,872)
|
-46.0%
|
|
|
|
|
|||
|
Income
before Income Taxes
|
34,746
|
24,621
|
41.1%
|
52,927
|
-34.4%
|
|
|
|
|
|||
|
Provision
for Income Taxes
|
3,839
|
1,757
|
118.5%
|
4,361
|
-12.0%
|
|
|
|
|
|||
|
Net
Income
|
30,907
|
22,864
|
35.2%
|
48,566
|
-36.4%
|
|
Basic
EPS
|
0.72
|
0.53
|
35.2%
|
1.13
|
-36.4%
|
|
Basic
Shares
|
42,816,678
|
42,812,500
|
0.0%
|
42,816,678
|
0.0%
|
|
Diluted
EPS
|
0.71
|
0.53
|
33.3%
|
1.12
|
-36.5%
|
|
Diluted
Shares
|
43,501,720
|
42,895,049
|
1.4%
|
43,435,044
|
0.2%
|
10
|
Copa
Holdings
|
||||||||||
|
Balance
Sheet - USGAAP
|
||||||||||
|
(US$
Thousands)
|
June
30,
|
March
31,
|
June
30,
|
|||||||
|
2007
|
2007
|
2006
|
||||||||
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||
|
ASSETS
|
||||||||||
|
Current
Assets:
|
||||||||||
|
Cash
and cash equivalents
|
$
|
223,418
|
$
|
190,158
|
$
|
116,314
|
||||
|
Restricted
cash and cash equivalents
|
0
|
0
|
0
|
|||||||
|
Short-term
investments
|
27,500
|
27,500
|
10,771
|
|||||||
|
Total
cash, cash equivalents and short-term investments
|
250,918
|
217,658
|
127,085
|
|||||||
|
Accounts
receivable, net of allowance for doubtful accounts
|
92,394
|
80,628
|
61,507
|
|||||||
|
Accounts
receivable from related parties
|
860
|
2,270
|
36
|
|||||||
|
Expendable
parts and supplies, net of allowance for obsolescence
|
11,501
|
9,748
|
6,258
|
|||||||
|
Prepaid
expenses
|
18,677
|
19,017
|
17,048
|
|||||||
|
Other
current assets
|
8,759
|
8,015
|
5,264
|
|||||||
|
Total
Current Assets
|
383,109
|
337,336
|
217,198
|
|||||||
|
Long-term
investments
|
21,038
|
26,036
|
28,785
|
|||||||
|
Property
and Equipment:
|
||||||||||
|
Owned
property and equipment:
|
||||||||||
|
Flight
equipment
|
980,287
|
948,680
|
730,920
|
|||||||
|
Other
equipment
|
47,445
|
44,065
|
40,511
|
|||||||
|
1,027,732
|
992,745
|
771,431
|
||||||||
|
Less:
Accumulated depreciation
|
(119,660
|
)
|
(111,181
|
)
|
(90,875
|
)
|
||||
|
908,072
|
881,564
|
680,556
|
||||||||
|
Purchase
deposits for flight equipment
|
93,206
|
73,849
|
61,958
|
|||||||
|
Total
Property and Equipment
|
1,001,278
|
955,413
|
742,514
|
|||||||
|
Other
Assets:
|
||||||||||
|
Net
pension asset
|
815
|
759
|
1,471
|
|||||||
|
Goodwill
|
24,869
|
22,261
|
17,794
|
|||||||
|
Intangible
asset
|
36,464
|
32,640
|
27,151
|
|||||||
|
Other
assets
|
24,290
|
16,234
|
14,225
|
|||||||
|
Total
Other Assets
|
86,438
|
71,894
|
60,641
|
|||||||
|
Total
Assets
|
$
|
1,491,863
|
$
|
1,390,679
|
$
|
1,049,138
|
||||
|
LIABILITIES
AND SHAREHOLDER'S EQUITY
|
||||||||||
|
Current
Liabilities:
|
||||||||||
|
Current
maturities of long-term debt
|
$
|
118,197
|
$
|
103,154
|
$
|
65,390
|
||||
|
Accounts
payable
|
50,935
|
47,799
|
44,328
|
|||||||
|
Accounts
payable to related parties
|
10,709
|
8,242
|
8,152
|
|||||||
|
Air
traffic liability
|
153,951
|
116,730
|
104,191
|
|||||||
|
Taxes
and interest payable
|
37,228
|
35,751
|
26,835
|
|||||||
|
Accrued
expenses payable
|
38,826
|
33,317
|
21,178
|
|||||||
|
Other
current liabilities
|
11,205
|
2,838
|
2,517
|
|||||||
|
Total
Current Liabilities
|
421,051
|
347,831
|
272,591
|
|||||||
|
Non-Current
Liabilities:
|
||||||||||
|
Long-term
debt
|
605,977
|
599,851
|
473,995
|
|||||||
|
Post
employment benefits liability
|
1,927
|
1,792
|
1,419
|
|||||||
|
Other
long-term liabilities
|
8,766
|
8,023
|
7,545
|
|||||||
|
Deferred
tax liabilities
|
5,440
|
4,933
|
3,947
|
|||||||
|
Total
Non-Current Liabilities
|
622,110
|
614,599
|
486,906
|
|||||||
|
Total
Liabilities
|
1,043,161
|
962,430
|
759,497
|
|||||||
|
Shareholders'
Equity:
|
||||||||||
|
Class
A - 30,159,719 shares issued and outstanding
|
20,586
|
20,586
|
20,501
|
|||||||
|
Class
B - 12,778,125 shares issued and outstanding
|
8,722
|
8,722
|
8,722
|
|||||||
|
Additional
paid in capital
|
5,593
|
4,144
|
930
|
|||||||
|
Retained
earnings
|
409,302
|
391,956
|
264,694
|
|||||||
|
Accumulated
other comprehensive loss
|
4,499
|
2,841
|
(5,206
|
)
|
||||||
|
Total
Shareholders' Equity
|
448,702
|
428,249
|
289,641
|
|||||||
|
Total
Liabilities and Shareholders' Equity
|
$
|
1,491,863
|
$
|
1,390,679
|
$
|
1,049,138
|
||||
11
|
COPA
HOLDINGS, S.A. - EBITDAR RECONCILIATION
|
||||||||||
|
(Figures
in US$ thousands)
|
|
2Q07
|
2Q06
|
1Q07
|
||||||||
|
Net
Income
|
$
|
30,907
|
$
|
22,864
|
$
|
48,566
|
||||
|
Interest
Expense
|
(10,393
|
)
|
(6,698
|
)
|
(9,848
|
)
|
||||
|
Capitalized
Interest
|
736
|
550
|
531
|
|||||||
|
Interest
Income
|
3,031
|
1,570
|
2,542
|
|||||||
|
Income
Taxes
|
(3,839
|
)
|
(1,757
|
)
|
(4,361
|
)
|
||||
|
EBIT
|
41,372
|
29,199
|
59,702
|
|||||||
|
Depreciation
and Amortization
|
8,455
|
5,502
|
7,995
|
|||||||
|
EBITDA
|
49,827
|
34,701
|
67,697
|
|||||||
|
Aircraft
Rent
|
9,303
|
8,886
|
9,163
|
|||||||
|
Other
Rentals
|
2,575
|
2,558
|
2,685
|
|||||||
|
EBITDAR
|
$
|
61,706
|
$
|
46,145
|
$
|
79,546
|
||||
12
SIGNATURES
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.
(Registrant)
|
||
| |
|
|
| Date: 08/15/2007 | By: | /s/ Victor Vial |
|
Name:
Victor Vial
Title:
CFO
|
||
13