Fourth Quarter 2023 Highlights
(All figures are reported in U.S. dollars and compared to 4Q 2022 unless otherwise noted)
Net income of $112 million. Earnings per share of $0.10 and earnings per ADS of $0.97 cents.
Total operating revenues of $899 million, a 10% increase.
Total revenue per available seat mile (TRASM) increased 11% to $9.56 cents.
Available seat miles (ASMs) decreased 1.1% to 9.4 billion.
Total operating expenses of $735 million, representing 82% of total operating revenue.
Total operating expenses per available seat mile (CASM) decreased 2.3% to $7.81 cents.
Average economic fuel cost decreased 16% to $3.13 per gallon.
CASM ex fuel increased 11% to $4.86 cents.
EBITDAR of $281 million, a 35% increase.
EBITDAR margin was 31.3%, an increase of 6.0 percentage points.
Total cash, cash equivalents, restricted cash, and short-term investments totaled $789 million, representing 24% of the last twelve months’ total operating revenue.
Net debt-to-LTM EBITDAR2 ratio decreased to 3.4x, compared to 3.9x in 2022.
Enrique Beltranena, President & Chief Executive Officer, said: “Throughout 2023, we gained valuable lessons when resizing the operations, capitalizing on strong demand while adjusting our network, and turned a very complex situation into a solid financial result for the fourth quarter. We recorded our highest-ever historical quarterly TRASM and posted a net income of $112 million. Our performance demonstrated resilience in the face of the challenges encountered throughout the year, such as the extended FAA downgrade of Mexico to CAT 2, Pratt & Whitney's engine preventive accelerated inspections, and slot reductions at the Mexico City International Airport. Our proactive strategies and mitigation plan have proven effective.
Looking ahead, 2024 holds promise, as our booking curves and total unit revenues indicate continuing favorable trends aligned with our guidance. We expect that our focus on operational efficiency, customer satisfaction, and prudent capacity management will continue to drive profitability.”
Full Year 2023 Highlights3
(All figures are reported in U.S. dollars and compared to FY 2022 unless otherwise noted)
Net income of $8 million. Earnings per share of $0.01 and earnings per ADS of $0.07.
Total operating revenues of $3,259 million, a 14% increase.
Total revenue per available seat mile (TRASM) increased 3.8% to $8.38 cents.
Available seat miles (ASMs) increased 10% to 38.9 billion.
Total operating expenses of $3,036 million, representing 93% of total operating revenue.
Total operating expenses per available seat mile (CASM) decreased 1.7% to $7.81 cents.
Average economic fuel cost decreased 18% to $3.11 per gallon.
CASM ex fuel increased 13% to $4.81 cents.
EBITDAR of $823 million, a 40% increase.
EBITDAR margin was 25.2%, an increase of 4.7 percentage points.
Total operating revenues in the quarter were $899 million, a 10% increase, driven by an improved load factor and increased adoption of ancillary offerings.
Booked passengers amounted to 8.2 million in the quarter, a decrease of 2.7%. Domestic booked passengers decreased 7.7%, while international booked passengers increased 17%.
Total capacity, in terms of available seat miles (ASMs), decreased 1.1% to 9.4 billion.
The load factor for the quarter reached 88.1%, representing an increase of 0.8 percentage points compared to the same period in 2022.
TRASM increased 11% to $9.56 cents in the quarter and total operating revenue per passenger stood at $109, representing a 13% increase.
The average base fare was $54, a decline of 2.3%. The total ancillary revenue per passenger was $55, a 32% increase. Ancillary revenue represented 50% of total operating revenue, 7.6 percentage points above the fourth quarter 2022.
Total operating expenses in the quarter were $735 million, representing 82% of total operating revenue, compared to 93% in the fourth quarter of 2022.
CASM totaled $7.81 cents, a 2.3% decrease when compared to the same period of 2022. The average economic fuel cost decreased 16% to $3.13 per gallon in the period.
CASM ex fuel increased 11% to $4.86 cents. These increases were mainly caused by higher fleet depreciation, reduced capacity, and a stronger Mexican peso; partially offset by lower redelivery costs due to lease extensions and the compensation from Pratt & Whitney.
Comprehensive financing result represented an expense of $35 million in the fourth quarter of 2023, compared to a $38 million expense in the same period of 2022. For the period, the average exchange rate was Ps.17.58 per U.S. dollar, a 11% appreciation compared to the same quarter of 2022. At the end of the fourth quarter, the exchange rate stood at Ps.16.89 per U.S. dollar.
Income tax expense for the quarter was $17 million, compared to $44 million registered in the same period of 2022.
Net income in the quarter was $112 million, with an earnings per share of $0.10 and an earnings per ADS of $0.97 cents.
EBITDAR for the quarter was $281 million, an increase of 35% compared to the same period in 2022, primarily attributable to higher unit revenues and lower fuel prices. EBITDAR margin stood at 31.3%, an increase of 6.0 percentage points compared to the same quarter of the previous year.
Cash Flow
Net cash flow provided by operating activities in the quarter was $218 million. Net cash flow used in financing and investing activities was $82 million and $113 million, respectively.
Full Year 2023
Total operating revenues were $3,259 million, an increase of 14% compared to 2022.
Volaris transported 33.5 million passengers, an increase of 7.9%, while total capacity for the year, in terms of available seat miles (ASMs), increased 10% to 38.9 billion.
Load factor reached 86.0%, an increase of 0.4 percentage points compared to 2022.
TRASM increased 3.8% to $8.38 cents. Average base fare was $49, a 7.9% decrease and total operating revenue per passenger stood at $97, representing an increase of 6.1%.
Ancillary revenue per passenger was $48, posting a 26% increase and represented 49% of total operating revenues.
Volaris posted total operating expenses of $3,036 million, representing 93% of total operating revenue,
compared to 98% in 2022.
CASM decreased 1.7% to $7.81 cents. The average economic fuel cost of $3.11 per gallon, a 18% decrease compared to 2022 levels. CASM ex fuel increased 13% to $4.81 cents.
The comprehensive financing result for the full year 2023 amounted to an expense of $215 million, compared to the $176 million expense posted in 2022. The average exchange rate was Ps.17.76 per US dollar, a 12% appreciation compared to 2022. At the end of the period, the exchange rate stood at Ps.16.89 per US dollar.
The Company recorded an income tax benefit for the full year 2023 of $0.4 million, compared to an income tax benefit of $52 million registered in 2022.
For the full year 2023, Volaris reported a net income of $8 million, with an earnings per share of $0.01 and earnings per ADS of $0.07.
Volaris registered an EBITDAR of $823 million, a 40% increase compared to 2022. EBITDAR margin was 25.2%, an increase of 4.7 percentage points.
Balance Sheet, Liquidity and Capital Allocation
As of December 31, 2023, cash, cash equivalents, restricted cash and short-term investments were $789 million, representing 24% of the last twelve months total operating revenue.
Net cash flow provided by operating activities was $730 million, while cash used in investing and
financing activities were $462 million and $214 million, respectively.
The financial debt amounted to $653 million, while total lease liabilities stood at $2,906 million, bringing the net debt to $2,770 million.
Net debt-to-LTM EBITDAR7 ratio stood at 3.4x, compared to 3.9x in 2022 and 3.5x in the third quarter of 2023.