Volaris Reports September 2024 Traffic Results: 85% Load Factor

Volaris, the ultra-low-cost carrier (ULCC) serving Mexico, the United States, Central, and South America, reports its September 2024 preliminary traffic results.

In September 2024, Volaris' ASM capacity decreased by 12.8% year-over-year due to the accelerated Pratt & Whitney engine inspections and the resulting aircraft groundings. Volaris transported 2.3 million passengers during the month at a load factor of 85.0%, a 1.2 pp increase compared to last year. RPMs for the month decreased by 11.5%, with Mexican domestic RPMs down by 18.5%, while international RPMs increased 2.1%.

Enrique Beltranena, Volaris’ President and CEO said: “Volaris finished the third quarter with strong demand in both domestic and international markets. As we enter the final quarter of the year, we will have more normalized comparables, considering the timing of the accelerated engine inspections and the recovery of Cat 1 in the fourth quarter of 2023. The engine inspections’ process has evolved according to our forecast, and the Company continues to perform in line with our expectations.”

The latest from Volaris

Volaris, the ultra-low-cost carrier serving Mexico, the United States, Central, and South America, reports its August 2024 preliminary traffic results.  In August 2024, Volaris' ASM capacity decreased by 15.1% year-over-year due to the accelerated Pratt & Whitney engine inspections and the resulting aircraft groundings. Volaris transported 2.6 million passengers during the month at a load factor of 87.0%, flat against last year’s levels. RPMs for the month decreased by 15.3%, with Mexican domestic RPMs down by 22.0%, while international RPMs were effectively flat.

Enrique Beltranena, Volaris’ President and CEO said: "Our strategic fleet mitigation plan is on track and continues to deliver favorable outcomes. We have met our goals since the engine inspections began, and we are managing the situation with almost 30% of our fleet on the ground. We reaffirm our annual capacity guidance, which indicates an approximate 14% reduction. Volaris concluded the summer high season with a very solid operational performance and strong demand, which drove high load factors. Please note that comparable load factor figures from August through December of last year already include the consolidation of flights driven by the first round of accelerated P&W engine inspections."

Volaris scores 90% load factor during July 2024

Volaris, the ultra-low-cost carrier (ULCC) serving Mexico, the United States, and Central, and South America, reports its July 2024 preliminary traffic results.

In July 2024, Volaris' ASM capacity decreased by 15.0% year-over-year due to the accelerated Pratt & Whitney engine inspections and the resulting aircraft groundings. Load factor in the month increased by 2.0 pp YoY to 89.8%, as RPMs decreased by 13.0%. Mexican domestic RPMs decreased by 20.0%, while international RPMs increased by 1.0%. Volaris transported 2.7 million passengers during the month.

Enrique Beltranena, Volaris’ President and CEO said: “Our strategic fleet mitigation plan is on track and continues to deliver favourable outcomes; we have achieved our goals since the engine inspections began. We currently have a well-balanced market mix, with an increased presence in the cross-border market, that is strengthening our unit revenues. As shown with our July traffic, our booking curves similarly indicate robust performance for the summer high season.”

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Volaris reports financial results for the second quarter 2024

Volaris, the ultra-low-cost carrier (ULCC) serving Mexico, the United States, Central, and South America, has released its unaudited financial results for the second quarter of 2024.

Enrique Beltranena, President & Chief Executive Officer, said: “Volaris continues to perform positively, achieving our highest absolute EBITDAR for a second quarter despite the fleet groundings due to accelerated engine inspections. Volaris’ unwavering focus on execution and efficient cost control has enabled us to deliver strong results. Our mitigation plan is on track with favorable outcomes, and we have largely achieved our goals since the inspections began. In fact, we are improving our full-year ASM guidance to -14%3. We currently have a well-balanced market mix, with an increased presence in the cross-border market that has strengthened our TRASM, and our booking curves indicate ongoing robust performance for the summer high season.

With recent updates from Pratt & Whitney, we are cautiously optimistic about this evolving situation, but we recognize that the engine's time on wing remains a challenge. Looking ahead, as grounded aircraft gradually return to our productive fleet, we expect recent unit revenue levels to remain resilient and remain committed to prudent and rational growth, prioritizing profitability.”

Second Quarter 2024 Highlights

(All figures are reported in U.S. dollars and compared to 2Q 2023 unless otherwise noted)

Net income of $10 million. Earnings per American Depositary Shares (ADS) of $9 cents.

Total operating revenue of $726 million, a 7.2% decrease.

Total revenue per available seat mile (TRASM) increased 12% to $8.89 cents.

Available seat miles (ASMs) decreased by 17% to 8.2 billion.

Total operating expenses of $660 million, representing 91% of total operating revenue.

Total operating expenses per available seat mile (CASM) increased 9.1% to $8.08 cents.

Average economic fuel cost increased 6.1% to $2.86 per gallon.

CASM ex fuel increased 11% to $5.33 cents.

EBITDAR of $261 million, a 23% increase.

EBITDAR margin was 35.9%, an increase of 8.8 percentage points.

Total cash, cash equivalents, restricted cash, and short-term investments totaled $774 million, representing 24% of the last twelve months’ total operating revenue.

Net debt-to-LTM EBITDAR2 ratio decreased to 2.9x, compared to 3.1x in the previous quarter.

1 The financial information, unless otherwise indicated, is presented in accordance with the International Financial Reporting Standards (IFRS).

2 Includes short-term investments.

ACG delivers a new Airbus A321neo to Volaris

Aviation Capital Group LLC (ACG), a premier global full-service aircraft asset manager, announced the delivery of one A321neo aircraft on long-term lease to Volaris. Powered by the ultra-efficient Pratt & Whitney GTF engines, this is the third of four aircraft scheduled to deliver to the airline as part of a multiple-aircraft sale-leaseback transaction between ACG and Volaris.

ACG specializes in commercial aircraft leasing and aviation finance. In addition to aircraft leasing services, we provide aircraft asset management solutions tailored to meet our customers’ fleet management needs.

Volaris scores 86% load factor in May....

Volaris, the ultra-low-cost carrier serving Mexico, the United States, Central, and South America, has reported its May 2024 preliminary traffic results. 

In May 2024, Volaris' ASM capacity decreased by 17.5% year-over-year due to the accelerated Pratt & Whitney engine inspections and the resulting aircraft groundings. However, load factor increased by 1.6 pp YoY to 86.1%, as RPMs decreased by less than capacity. Mexican domestic RPMs decreased by 22.0%, while international RPMs decreased by 3.6%. Volaris transported 2.4 million passengers during the month.

Enrique Beltranena, Volaris’ President, and CEO said: “Despite limitations in capacity growth due to fleet availability, we have successfully increased capacity in the U.S.-Mexico transborder market while optimizing our entire network. The international market now represents over 40% of our total capacity, leveraging our ability to generate US dollar sales. Further, our strategic adjustments to the domestic network are yielding promising results. Booking trends for the remainder of the second quarter are meeting our expectations and showing robust performance.”

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Volaris offers low base fares to build its market, providing quality service and extensive customer choice. Since the beginning of operations in March 2006, Volaris has increased its routes from 5 to more than 197 and its fleet from 4 to 134 aircraft. Volaris offers more than 460 daily flight segments on routes that connect 44 cities in Mexico and 29 cities in the United States, Central, and South America, with one of the youngest fleets in Mexico. Volaris targets passengers who are visiting friends and relatives, cost-conscious business and leisure travelers in Mexico, the United States, Central, and South America. Volaris has received the ESR Award for Social Corporate Responsibility for fifteen consecutive years. 

Volaris gets a new Airbus A321neo on lease from Aviation Capital Group

The aircraft leasing giant, Aviation Capital Group has confirmed the delivery of a new Airbus A321neo aircraft to Volaris.

The jet is powered by the ultra-efficient Pratt & Whitney GTF engines, this is the second of four aircraft scheduled to be delivered to the airline as part of a multiple-aircraft sale-leaseback transaction between the budget carrier and ACG.

ACG specializes in commercial aircraft leasing and aviation finance. In addition to aircraft leasing services, we provide aircraft asset management solutions tailored to meet our customers’ fleet management needs. 

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Volaris Reports Financial Results for the Fourth Quarter 2023: Net Income of USD $112 million

 Volaris, the ultra-low-cost carrier (ULCC) serving Mexico, the United States, Central, and South America, has announced its financial results for the fourth quarter and full year 20231.

                

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.

Volaris Reports January 2024 Traffic Results: 88% Load Factor

Controladora Vuela Compañía de Aviación, S.A.B. de C.V.  - Volaris, the ultra-low-cost carrier (ULCC) serving Mexico, the United States, Central, and South America, reports its January 2024 preliminary traffic results.

In January 2024, Volaris' ASM capacity decreased by 10.7% year-over-year, while RPMs decreased by 8.9%; the result was a load factor increase of 1.8 pp YoY to 88.0%. Volaris transported 2.5 million passengers during the month, a 13.0% decrease compared to January 2023. Mexican domestic RPMs decreased by 20.1%, while international RPMs increased by 15.1%.

Enrique Beltranena, Volaris' President and CEO said: “The GTF engine accelerated inspections have resulted in a significant reduction in ASMs, particularly within the Mexican domestic market. This reduction has been balanced by increased capacity in international markets following Mexico’s Category 1 upgrade by the United States’ Federal Aviation Administration (FAA). Consequently, the reallocation of capacity has led to improvements in load factors within the Mexican domestic market and robust transborder traffic between Mexico and the U.S.

As highlighted last month, unit revenue growth continues to show strong performance. The shift in trend in total unit revenue that started in the fourth quarter of 2023 was sustained in January 2024. Our booking curves suggest that this positive trend will continue for the upcoming months, in line with our 2024 guidance.”

Volaris scores 85%load factor in December

Volaris, the ultra-low-cost carrier (ULCC) serving Mexico, the United States, Central, and South America, reports its December 2023 preliminary traffic results.

In December 2023, Volaris' ASM capacity decreased by 3.1% year-over-year, while RPMs decreased by 2.3%; the result was a load factor increase of 0.7 pp YoY to 85.4%. Volaris transported 2.8 million passengers during the month, a 4.6% decrease compared to December 2022. Mexican domestic RPMs decreased by 11.1%, while international RPMs increased by 18.4%.

Enrique Beltranena, Volaris' President and CEO said: "Our December traffic results reinforced our confidence in the resilience of our network and the strength of our business plan for 2024. We are pleased with the demand we experienced during the holiday high season, which, along with the changes we have implemented to our network, helped us achieve high-single-digit year-over-year total unit revenue growth. Equally important, our booking curve gives us confidence that this trend will be sustained in the first quarter".

	Dec 2023		Dec 2022		Variance		YTD Dec 2023		YTD Dec 2022		Variance
RPMs (million, scheduled & charter)
Domestic	1,809		2,034		-11.1%		22,422		21,623		3.7%
International	1,020		861		18.4%		11,027		8,569		28.7%
Total	2,829		2,895		-2.3%		33,449		30,191		10.8%
ASMs (million, scheduled & charter)
Domestic	2,025		2,385		-15.1%		25,630		24,604		4.2%
International	1,286		1,034		24.4%		13,260		10,676		24.2%
Total	3,311		3,419		-3.1%		38,890		35,281		10.2%
Load Factor (%, scheduled, RPMs/ASMs)
Domestic	89.3%		85.3%		4.0 pp		87.5%		87.9%		(0.4) pp
International	79.3%		83.3%		(4.0) pp		83.2%		80.3%		2.9 pp
Total	85.4%		84.7%		0.7 pp		86.0%		85.6%		0.4 pp
Passengers (thousand, scheduled & charter)
Domestic	2,108		2,342		-10.0%		25,909		25,043		3.5%
International	706		606		16.4%		7,588		6,007		26.3%
Total	2,813		2,949		-4.6%		33,497		31,051		7.9%

The information included in this report has not been audited and does not provide information on the Company’s future performance. Volaris’ future performance depends on several factors. It cannot be inferred that any period’s performance or its comparison year over year will indicate a similar performance in the future.

Volaris reports load factor of 90% in November 2023 results.....

Volaris,  the ultra-low-cost carrier serving Mexico, the United States, Central, and South America, has reported a load factor of almost 90% during November 2023.

In November 2023, Volaris' ASM capacity decreased by 2.2% year-over-year, while RPMs decreased by 0.2%; the result was a load factor increase of 1.8 pp YoY to 89.8%. Volaris transported 2.7 million passengers during the month, a 0.9% decrease compared to November 2022. Mexican domestic RPMs decreased by 7.9%, while international RPMs increased by 17.6%.

Enrique Beltranena, Volaris' President and CEO, said: "In response to reduced Pratt & Whitney ("P&W") engine availability in November, we reduced domestic ASMs and redeployed capacity to the US market by capitalizing on Category 1 opportunities. This strategic approach successfully aligned with positive demand, consistent with our full-year expectations.

Looking forward, it is noteworthy that we have reached an agreement with P&W that contemplates compensation for each GTF engine removed from our fleet. The agreement will help address fixed costs associated with the engines during inspections"

Nov 2023	Nov 2022	Variance	YTD Nov 2023	YTD Nov 2022	Variance
RPMs (million, scheduled & charter)
Domestic	1,736	1,886	-7.9%	20,613	19,588	5.2%
International	967	822	17.6%	10,008	7,708	29.8%
Total	2,703	2,707	-0.2%	30,620	27,296	12.2%
ASMs (million, scheduled & charter)
Domestic	1,867	2,097	-11.0%	23,605	22,220	6.2%
International	1,143	980	16.7%	11,974	9,643	24.2%
Total	3,011	3,077	-2.2%	35,579	31,862	11.7%
Load Factor (%, scheduled, RPMs/ASMs)
Domestic	93.0%	89.9%	3.1 pp	87.3%	88.2%	(0.8) pp
International	84.5%	83.9%	0.7 pp	83.6%	79.9%	3.6 pp
Total	89.8%	88.0%	1.8 pp	86.1%	85.7%	0.4 pp
Passengers (thousand, scheduled & charter)
Domestic	2,047	2,164	-5.4%	23,801	22,701	4.8%
International	667	576	15.8%	6,883	5,401	27.4%
Total	2,714	2,740	-0.9%	30,684	28,102	9.2%

The information included in this report has not been audited and does not provide information on the Company’s future performance. Volaris’ future performance depends on several factors. It cannot be inferred that any period’s performance or its comparison year over year will indicate a similar performance in the future.

Aviation Capital Group confirms delivery of a new Airbus A321neo to Volaris

Aviation Capital Group has confirmed the delivery of one new Airbus A321neo aircraft on long-term lease to Volaris. Powered by the ultra-efficient Pratt & Whitney GTF engines, this is the first of four aircraft scheduled to deliver to the airline as part of a multiple-aircraft sale-leaseback transaction between ACG and Volaris.

Aviation Capital Group is one of the world’s premier full-service aircraft asset managers with over 490 owned, managed and committed aircraft as of September 30, 2023, leased to roughly 90 airlines in approximately 45 countries. It was founded in 1989 and is a wholly owned subsidiary of Tokyo Century Corporation.

Volaris, the low-cost airline recently released details of its third quarter results which a 10% increase on total operating revenues of $848 million, with available seat miles up 8.2% to 10.1 billion.  Net loss of $39 million with EBITDAR of $207 million.

Enrique Beltranena, President and chief Executive Officer, said: “Volaris' performance in the third quarter showed resilience, resulting in revenue growth. This growth was mainly due to increased passenger volumes and record-high ancillary revenue per passenger. We achieved this by maintaining strong cost control, especially when it came to non-fuel expenses.

Despite facing challenges related to Pratt & Whitney's GTF preventive accelerated inspections, Volaris is fully committed to ensuring the safety, financial stability, and long-term success of our airline. We are actively addressing the global issue of engine inspections affecting multiple airlines and are working closely with Pratt & Whitney to obtain the necessary technical support and financial compensation for the affected engines.

We’ve developed a mitigation plan to partially offset the impact. Our focus for 2024 is to maximize unit revenues and margins while optimizing our network to the best extent possible given the current environment.”

 

Volaris reports September 2023 traffic results

Volaris the ultra-low-cost carrier (ULCC) serving Mexico, the United States, Central, and South America, reports its September 2023 preliminary traffic results.

In September 2023, Volaris’ capacity (measured in ASMs) increased by 7.5% year-over-year, while demand (measured in RPMs) increased by 3.1%; the result was a load factor decrease of 3.6 pp YoY to 83.8%. Volaris transported 2.5 million passengers during the month, a 0.6% decrease compared to September 2022. Demand (measured in RPMs) in the Mexican domestic market decreased by 4.6%, while in the international market, demand increased by 22.4%.

During the third quarter of 2023, the average economic fuel cost was $3.16 per gallon, an increase of 17% compared to the second quarter of 2023.

Volaris successfully completes Ps. $1.5 billion Asset-Backed Trust Notes Offering

Volaris, the ultra-low-cost carrier (ULCC) serving Mexico, the United States, Central, and South America, has successfully concluded the issuance of 15 million asset-backed trust notes an Mexico under the ticker VOLARCB 23, totalling Ps. $1.5 billion.

This is the third offering under the program authorized by the Mexican National Banking and Securities Commission for an amount of up to Ps. $5.0 billion.

These Trust Notes are backed by future collection rights under agreements entered with credit card processors for the sale of airline tickets and other related services through VISA and Mastercard credit cards, through our internet portal, travel agencies, call centres and sales offices.

The Trust Notes were rated "HR AA+ (E)" and "AA+/M(e)" by the rating agencies HR Ratings de México, S.A. de C.V. and Verum Calificadora de Valores, S.A.P.I. de C.V., respectively, and have a five-year maturity term and carry an interest rate of 28-day TIIE (interbank rate) + 215 basis points.

This communication does not constitute an offer to sell or an offer to purchase, nor shall there be or give rise to the possibility of any sale of the Trust Notes in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration under the laws governing financial instruments in such jurisdiction.

Volaris has disclosed 25 A321neo from a purchase agreement signed in October 2022.

Mexican ultra-low-cost airline and all-Airbus operator Volaris has disclosed 25 A321neo from a purchase agreement signed in October 2022. 

These aircraft bring Volaris total backlog to 143 A320neo Family aircraft, which will support the airline’s continuous fleet renewal and expansion, powered by Pratt & Whitney engines.

“These A321neos will support our long-term business viability and sustainability strategy while moving us closer to operating an all-NEO fleet by 2028. Our 143 aircraft backlog demonstrates Volaris financial strength and will guarantee our growth in the Mexican market as well as in routes to the United States and Central America," said Enrique Beltranena, Volaris President and Chief Executive Officer.

“The A321neo’s superior performance and efficiency will continue to drive Volaris’ network growth. As the fleet grows the airline will be well-positioned to meet future demand, especially in the Mexican leisure market. We look forward to working closely with Volaris as it continues to spread its wings," said Christian Scherer, Chief Commercial Officer and Head of Airbus International.

The A321neo is the largest-fuselage member of Airbus’ best-selling single-aisle A320 Family. The A321neo allows operators to cover the entire market while offering the lowest seat-mile cost of any single-aisle available.

Volaris became an Airbus customer in 2006, and since then the airline has ordered 206 A320 Family aircraft, including more than 170 A320neo Family aircraft. Volaris is the largest A320neo Family operator in Latin America.

Airbus has sold over 1,150 aircraft in Latin America and the Caribbean. More than 750 are in operation throughout the region, with another 500 in the order backlog, representing a market share of nearly 60% of in-service passenger aircraft. Since 1994, Airbus has secured 75% of net orders in the region.