Mexico City, Mexico, October 16th – Grupo Aeromexico S.A.B. de C.V. (“Aeromexico”) (BMV: AEROMEX), today reported its unaudited consolidated results for the third quarter 2018.
KEY FINANCIAL HIGHLIGHTS FOR THE THIRD QUARTER 2018
- Grupo Aeromexico’s third quarter 2018 revenue reached $18.2 billion pesos, a 14.4% year-on- year increase. During the quarter Revenue per ASK (RASK) increased by 7.4% compared to the same period of 2017.
- Thequarterlyfinancialresultsreflectthenegativeimpactofa45.7%increaseinpesodenominated fuel prices and the 6.7% depreciation of the Mexican peso against the US dollar.
- Asaresult,CASKinpesosincreasedby15.0%,whileCASKindollarsincreased7.8%duringthe quarter. CASK excluding fuel in pesos increased by 5.6% while CASK excluding fuel in dollars decreased 1.0%, highlighting Grupo Aeromexico ́s ongoing focus on optimizing unit costs.
- Third quarter EBITDAR reached $3.4 billion pesos. EBITDAR margin was 18.7%.
- During the third quarter of 2018, Grupo Aeromexico reported an operating profit of $235 million pesos. Operating margin reached 1.3%. This result represents the 34th consecutive quarter of positive EBIT results.
- Aeromexico reported a net loss of $617 million pesos for the third quarter 2018.
- During the quarter, the Company incorporated two aircraft into its fleet under operating lease agreements. As of September 30, 2018, Grupo Aeromexico’s operating fleet comprised 130 aircraft.
Jonathan Wallden
SVP Financial Planning & Investor Relations jwallden@aeromexico.com
Ricardo Sánchez Baker CFO rsbaker@aeromexico.com
3Q18 RESULTS
MANAGEMENT DISCUSSION AND ANALYSISFinancial Standards
All figures are expressed in millions of pesos unless otherwise indicated. Grupo Aeromexico’sfinancial statements are prepared in accordance with International Financial Reporting Standards (IFRS). The International Accounting Standard 1 (IAS 1) «Presentation of Financial Statements» establishes that in the Consolidated Statement of Comprehensive Income additional items, headings and subtotals can be presented when they are relevant to understanding the financial performance
of the entity.
The following information provides an overview of selected consolidated financial and operating results, comparing the Company’s unaudited consolidated financial statements for the third quarter
2018 with those of the third quarter 2017.
Aeromexico has adopted two new IFRSs: IFRS 9 Financial Instruments and IFRS 15 Revenue from
Contracts with Customers.
IFRS 9 includes revised guidance for financial instruments classification and measurement, including a new model of expected credit losses to calculate the impairment of financial assets, and the new general requirements for hedge accounting. The Company has formally adopted hedge accounting
in line with IFRS 9.
IFRS 15 establishes a five-step model to determine the nature, amount, timing and uncertainty of revenue and cash flows arising from a contract with a customer. The Company adopted IFRS 15 in its consolidated financial statements from January 1st, 2018, using the full retrospective method. The
main financial reporting effects of implementing IFRS15 are detailed below:
An increase in the passenger revenue account line primarily driven by various reclassifications in the other income account line, such as the reclassification of income for unused tickets (breakage) and income for complementary services (excess baggage and
other passenger charges).
This is partially offset by a decrease mainly driven from the reclassification of passenger compensation payments (previously recognized as an operating expense) and the reclassification of the cost per kilometers of Aeromexico’s frequent flyer program (previously
recognized in Other income).
• •
Due to the retrospective adoption of IFRS 15, the following financial information has been restated to allow for comparison between periods. For further details please review our 2017 audited financial statements.
2
3Q18 RESULTS
Three Months Ended September 30
Financial Highlights
Total Revenue (MXP million)
2018
2017 Restated****
Var 2018 vs 2017
18,228
15,936
14.4%
EBITDAR (MXP million) *
3,409
4,175
(18.3%)
EBITDAR Margin* (% of Revenue)
18.7%
26.2%
(7.5) p.p.
Operating Profit (MXP million) *
235
1,349
(82.6%)
Operating Margin (% of Revenue) **
1.3%
8.5%
(7.2) p.p.
Consolidated Net Profit (MXP million)
(617)
344
NA
Controlling Interest Net Margin (% of Revenue)
(3.4)%
2.2%
NA
Losses per share (pesos)
(0.89)
0.49
NA
Operating Highlights
2017
As Originally Reported****
15,940 4,140 26.0% 1,314 8.2% 339 2.1% 0.48
12,858 10,849 84.4% 5,398 78.7% 434,863 1.279 1.240 1.056 1.150 0.065 0.868 0.049
|
Total ASKs (millions) |
13,694 |
12,858 |
6.5% |
|
Total RPKs (millions) |
11,567 |
10,849 |
6.6%
|
|
Load factor on scheduled flights (%) |
84.5% |
84.4% |
0.1 p.p. |
|
Passengers (‘000) |
5,739 |
5,398 |
6.3%
|
|
On-Time departure performance within 15 minutes |
85.6% |
78.7% |
6.9 p.p. |
|
(%) |
456,562 |
434,863 |
5.0 %
|
|
Yield (pesos)*** |
1.361 |
1.279 |
6.5 % |
|
Total revenue / ASK (pesos) |
1.331 |
1.239 |
7.4 % |
|
Passenger revenue / ASK (pesos) |
1.130 |
1.056
|
7.0 % |
|
Total cost / ASK (pesos) |
1.319 |
1.147 |
15.0 % |
|
Total cost / ASK (USD) |
0.069 |
0.064
|
7.8 % |
|
Total cost / ASK excluding fuel (pesos) |
0.913 |
0.865
|
5.6 % |
|
Total cost / ASK excluding fuel (USD) |
0.048 |
0.049
|
(1.0) % |
Figures may not sum to total due to rounding. All numbers restated IFRS 9 Financial Instruments and IFRS 15 Revenue from Contracts with Customers
This metric is not defined under IFRS but has been included for reference given its relevance to the Company’s performance.EBITDAR is defined as earnings before interest, taxes, and depreciation, amortization, and rental costs.
Operating Income.
Estimated as passenger revenues divided by RPKs of itinerary flights.
For the period ended December 31, 2017, all numbers are presented as originally reported and restated due to the adoption of IFRS 15 Revenue from Contracts with Customers.
* ** *** ****
