safe harbor · 1q earnings results presentation. ... 1q2016 figures exclude one-time expenses...
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1Q Earnings Results Presentation
The present document consolidates information from Avianca Holdings S.A. and its subsidiaries, including unaudited financial figures, operationalmanagerial indicators, financial indicators and managerial projections of future performance, in line with Avianca Holdings S.A. and its subsidiaries’business plans. References to future behaviors are indicative and do not constitute a guarantee of compliance by the Company, its shareholders ordirectors. Unaudited accounting and financial information and projections presented in this document are based on internal data and calculationsmade by the Company, which may be subject to changes or adjustments. Any change in the current economic conditions, the aviation industry, fuelprices, international markets and external events, among others, may affect the ongoing business results and future projections.
Avianca Holdings S.A. herein after Avianca Holdings and its subsidiaries warn investors and potential investors that future projections are not aguarantee of performance and that actual results may differ materially. Every investor or potential investor will be responsible for investment decisionstaken or not taken as a result of his or her assessment of the information contained herein. Avianca Holdings S.A. is not responsible for any thirdparties’ content. Avianca Holdings may make changes and updates to the information contained herein.
The information, tables and logos contained in this presentation may not be reproduced without the consent of Avianca Holdings S.A.
SAFE HARBOR
Executive Summary
1Q 2017
• Strategic Commercial Alliance negotiations with United Airlines
• Capitalization of USD 200 million
• Potential AVH and AvBrasilIntegration under review
• Routes: Bogota – Boston Bogota – Montevideo Medellin – Monteria
• Transported 11,200 tons of Valentine’s Day flowers ;+15% vs. 2016
• CASH to LTM Revenue of 10.5%; +100bps when compared to Dec. 2016
• 6.6% Adjusted EBIT1
Margin for Q1 2017• US$1.07 Billion total
revenues in 2017
• Load Factor of 81.9%;+311 bps vs. 1Q 2016
• -1.4% CASK1 ex fuel reduction in 1Q 2017 to 6.3¢,
• Fourth CASK1 ex fuel reduction in the last five quarters
• More than 7.5 mil passengers transported; +5.5% Year on Year
H I G H L I G H T S
F I N A N C I A L
O P E R AT I O N A L
SUBSEQUENT EVENTS
• Awarded TripAdvisor “Travelers’ Choice Awards for Airlines” as the 2017 best Airline in Latin America
• New York State Supreme Court, denies request of expedited recovery
Source: Company Information1. When indicated the figures exclude the following one-time items: $1.7M: extraordinary projects; 1Q2016 figures exclude one-time expenses disclosed on previous earnings releases and cargo discount - 1Q2016 cargo discount: $28.0
AVH Network
AvBrasil Network
FINANCIAL AND OPERATIONAL
RESULTS1Q 2017
Aircraft Dec 2016 In Out Mar. 2017
Airbus A320 Family1 110 - -- 110
ATR – 72 15 - - 15
Cessna 208 13 - - 13
Boeing 787 10 1 - 11
Embraer E190 10 - 2 8
Airbus A330 9 - - 9
Airbus A330F 5 - - 5
Airbus A300F 5 1 - 6
ATR – 42 2 - - 2
Boeing 767F 2 - - 2
Total 181 +2 -2 181
WE EXECUTED ON OUR FLEET PLAN
1Q2017 OPERATING FLEET STATUS CAPACITY
100/194 pax2
68 pax
12 pax
250 pax
96 Pax
252 pax
68 tons
40 tons
48 pax
53 tons
Source: Company Information1 The Airbus A320 Family is comprised of: 10 A318 19 A319, 49 A320, 2 A321, 8 A319S, 12 A320S and 9 A321S2 A320 Family Seating Capacity: A318: 100pax, A319: 120pax, A320: 150pax, A321: 194pax.
11,504 12,180
47,145
47,821
1Q2016 1Q2017 FY2016 LTM
8.7
8.6 8.6 8.6
1Q2016 1Q2017 FY2016 LTM
9,060
9,972
38,233
39,144
1Q2016 1Q2017 FY2016 LTM
INCREASE IN LOAD FACTOR DRIVEN BY ROBUSTTRAFFIC NUMBERS
Source: Company information
ASKs – millions RPKs – millions
Yield - US¢ Load Factor
+5.9% +10.1%
78.8% 81.9%
81.1% 81.9%
1Q2016 1Q2017 FY2016 LTM
+2.4%+1.4%
977 1,068
4,0824,172
1Q2016 1Q2017 FY2016 LTM
RASK1-US¢ 8.5 8.8 8.7 8.7
215218
879 883
1Q2016 1Q2017 FY2016 LTM
6.46.3
6.4 6.3
1Q2016 1Q2017 FY2016 LTM
1Q´2017 RESULTS WERE ALSO SUPPORTED BY A LEANER COST STRUCTURE
Revenues1 – millions CASK1 ex Fuel - US¢
EBITDAR1 – millions EBIT1 – millions
+9.3%
72 70
295 293
1Q2016 1Q2017 FY2016 LTM
-0.3%+2.2%
CASK1 7.9 8.2 8.0 8.1
EBITDAR1
Margin22.0% 20.4% 21.5% 21.2%
EBIT1
Margin 7.4% 6.6% 7.2% 7.0%
0.4%
Source: Company Information1. When indicated the figures exclude the following one-time items: $1.7M: extraordinary projects; 1Q2016 figures exclude one-time expenses disclosed on previous earnings releases and cargo discount - 1Q2016 cargo discount: $28.0
-1.4%
1.5%
+ 18.1%
+ 2.5%
+ 13.9%
+ 1.4%
- 0.8%
Central America & Caribbean4
HM to North America2
Home Markets to Europe
Domestic*
Intra Home Markets1
HM to South America3
LOAD FACTORS ALSO CONTINUE TO BENEFIT FROM AVIANCA’S NETWORK FLEXIBILITY
Total
1Q 2017 ASK Growth
1Q 2017RPK Growth
1Q 2017Load Factor
Region
ASK Growth 5.9%
RPK Growth 10.1%
Load Factor81.9%
*Domestic Market: Colombia, Peru, Ecuador 1 Local Intra-Markets: Colombia, Peru, Ecuador, Salvador, Costa Rica, Guatemala; 2 From Local Markets to North América including México 3 From Colombia, Perú, Ecuador and Costa Rica to Bolivia, Chile, Argentina, Brazil ,Uruguay and Venezuela, 4 Belize, Cuba Curazao, Republica Dominicana, Panamá, Costa Rica, Guatemala, Honduras, Nicaragua
1Q 2017Insights
Robust position thanks tostrong network and frequencies
Strong demand and yieldgrowth slight capacity increase
Economic improvement inSouth America drives demandto Caribbean markets
Strong capacity expansionslightly outpacing demandgrowth
Demand growth ahead ofcapacity growth in mainmarkets
Strong demand growth, supportcapacity increases combinedwith economic recovery
+ 2.7%
+ 16.7%
+ 7.6%
+ 13.4%
+ 2.3%
+ 8.7%
+ 19.0%
77.8%
84.4%
79.4%
80.3%
77.3%
86.4%
58.6%
12.2%
13.8%
Otros9.6%
4.6%
57.8%
16..2%
15.7%
Otros5.5%
4.2%1.1%
*Domestic Market: Colombia, Peru, Ecuador 1 Local Intra-Markets: Colombia, Peru, Ecuador, Salvador, Costa Rica, Guatemala; 2 From Local Markets to North América including México 3 From Colombia, Perú, Ecuador and Costa Rica to Bolivia, Chile, Argentina, Brazil ,Uruguay and Venezuela, 4 Belize, Cuba Curazao, Republica Dominicana, Panamá, Costa Rica, Guatemala, Honduras, Nicaragua
AVIANCA CONTINUES TO CONSOLIDATE ITS LEADERSHIPPOSITION IN THE COLOMBIAN DOMESTIC MARKET
Source: Aeronáutica Civil, MIDT
1
INTRA-HOME MARKETS
1 69%
HOME MARKETSTO NORTH AMERICA
125%
HOME MARKETSTO SOUTH AMERICA
2 31%
HOME MARKETSTO SPAIN
1 33%
COLOMBIA DOMESTIC1 PERU DOMESTIC2
1 Mar 20172 Feb 2017
3
CARGO & OTHER1Q 2017
AVIANCA HOLDINGS: MORE THAN JUST AN AIRLINE
Source: Company Information; 1 5 Airbus 330F, 5 Airbus 300F and 2 Boeing 767F; 2 includes Domestic Colombian and Peru
■ Aircraft maintenance, crew training and other airport
services to other carriers
■ Travel-related services to customers including all-
inclusive vacation deals
■ In-flight duty-free sales
■ 12 freight aircraft complemented by passenger fleet bellies
■ Deprisa is a leading express courier operation in Colombia
with a broad domestic and international product portfolio;
UPS allied in Colombia
■ Strong brand recognition and reputation in Colombia
■ One of the largest loyalty programs in Latin America
■ 20-year agreement, guaranteed exclusivity and seat
availability from Avianca
■ Solid burn-to-earn ratio
■ 12% YoY growth in 2015 in revenue from
external clients
■ 2,700+ hours of flight simulators
commercialized
■ 12 cargo aircraft(1)
■ 2,346mm ATKs(2)
■ 1,291mm RTKs(2)
■ 38% | 11% market Share Colombia | Miami
■ 7.2+ mm members (FY2016)
■ 558+ active co-branded credit cards
■ 327 commercial Partners
■ Freddie award winner 2013 – 2017
Courier
COURIER AND CARGO
SERVICES
LOYALTYBUSINESS
OTHERSERVICES
Business Overview Brands Key Highlights
121
125
1Q2016 1Q2017
306
329
1Q2016 1Q2017
+7.3%
578
620
1Q2016 1Q2017
AVIANCA CARGO: FINANCIAL AND OPERATIONAL RESULTS
Source: Company information. includes Domestic Colombian and Peru
Revenues – millions ATKs – millions
RTKs - millions Load Factor
+2.9% +7.2%
52.9% 53.0%
1Q2016 1Q2017
• 1Q’17 revenues increased 20.9% Year on Year
• 558K active co-branded credit cards; a 22.7% increase vs. 1Q’16
• Almost 7.2 million members; an 8.2% increase vs. 1Q’16
• 327 commercial partners; +25.8% vs. 1Q’16
LIFEMILES LOYALTY PROGRAM
Peru:Ecuador:
Uruguay:
Best Promotion
Best up and coming program
Colombia:
Source: Company information
Awards:
NEW COMMERCIAL PARTNERS & AWARDS
FLIGHT PLAN2017
Source: Company information.
1Q 2017 2017 OUTLOOK
PAX
ASK
LF
E B I T ¹
5.5% 4.0% – 6.0%
5.9% 6.5% – 8.5%
81.9% 80.0% – 82.0%
6.6% 6.0% – 8.0%
Source: Company Information1. When indicated the figures exclude the following one-time items: $1.7M: extraordinary projects; 1Q2016 figures exclude one-time expenses disclosed on previous earnings releases and cargo discount - 1Q2016 cargo discount: $28.0
IN SUMMARYThe Company continues to successfully optimize its cost structure and enhanceprofitability while:
Increasing cash to LTM revenue to 10.5%, to USD 442 million
Achieving a +8.9% quarter over quarter increase in Passenger Revenues
Strengthening the top line through improving yield trends
Reducing CASK – ex fuel by 1.4%, reaching 6.3¢ as compared to 6.7¢ in 1Q 2016
Increasing Load Factors by +311 bps vs 2016, to 81.9%, with a 10.1% increase in trafficnumbers - outpacing capacity growth
Source: Company Information1. When indicated the figures exclude the following one-time items: $1.7M: extraordinary projects; 1Q2016 figures exclude one-time expenses disclosed on previous earnings releases and cargo discount - 1Q2016 cargo discount: $28.0
Thank YouContact Information:Investor Relations [email protected]: (57) 1 – 5877700 www.aviancaholdings.com