GOL Linhas Aéreas Inteligentes S.A. ("GOL" or "Company") (NYSE: GOL and B3: GOLL4), Brazil's largest domestic airline by market share, today announces its consolidated results for the third quarter of 2019 (3Q19).
All information is presented in Brazilian Reais (R$), in accordance with international accounting standards (IFRS), and comparisons are with the third quarter 2018, unless stated otherwise. The information contained herein should be read along with the quarterly information for the nine-month period ended September 30, 2019 submitted to the Securities and Exchange Commission (SEC) and to the Comissão de Valores Mobiliários (CVM).
- Net revenue was R$3.7 billion, the highest ever recorded by GOL for a third quarter, and an increase of 28.3% compared to 3Q18.
- EBITDA margin was 30.7% in 3Q19, an increase of 11.8 p.p. quarter-over-quarter. GOL's 2019 EBIT margin and EBITDA margin guidance is approximately 17% and 29%, respectively.
- Revenue per Passenger Kilometer (RPK) increased 12.8% totaling 11.1 billion in 3Q19, driven by 13.0% growth in the number of transported passengers, while Available Seat Kilometer (ASK) growth was 7.6%.
- The Company transported almost 10 million customers during the quarter, a growth of 13.0% over the same period last year, and achieved a 38% market share in the Brazilian domestic market, according to ANAC data. GOL transported 39% of passengers in the corporate segment, according to ABRACORP data.
- R$463.2 million of financial debt was amortized in the quarter.
Strong operating indicators:
Revenue per Passenger Kilometer (RPK) increased 12.8% totaling 11.1 billion in 3Q19, driven by a 13.0% growth in the number of transported passengers, while Available Seat Kilometer (ASK) growth was 7.6%. Strong passenger demand and dynamic revenue management enabled GOL to offset the increase in operating unit costs. The Company achieved:
(i) Average yield per passenger of 31.50 cents (R$), an increase of 14.8% compared to 3Q18;
(ii) Average load factor of 82.9%, an increase of 3.8 p.p. quarter-over-quarter;
(iii) On-time performance of 91.2% in 3Q19 according to Infraero and data from major airports.
Net revenue was R$3.7 billion, the highest ever recorded by the Company, and an increase of 28.3% over 3Q18. GOL carried 9.8 million Customers in the quarter (+13.0% over 3Q18), with 9.2 million in the domestic market (+11.4% over 3Q18) and 0.6 million in the international market (+48.6% over 3Q18). Net Revenue per Available Seat Kilometer (RASK) was 27.67 cents (R$) in 3Q19, an increase of 19.2% over 3Q18. Net Passenger Revenue per Available Seat Kilometer (PRASK) was 26.12 cents (R$) in 3Q19, an increase of 20.4% over 3Q18. The net revenue guidance for 2019 is approximately R$13.7 billion.
Unit costs based on Cost per Available Seat Kilometer (CASK), excluding non-recurring expenses, increased by 5.8%, from 21.28 cents (R$) in 3Q18 to 22.51 cents (R$), mainly due to higher depreciation, higher personnel expenses and higher passenger costs. Fuel costs per ASK decreased 6.7%, mainly due to a reduction of fuel taxes, partially offset by additional consumption due to the MAX delays. CASK ex-fuel, excluding non-recurring expenses, increased by 14.2%. GOL has the lowest unit costs in its markets. GOL's 2019 non-fuel CASK guidance is approximately 14.5 cents (R$).
Due to strong cost control and yield management, the Company achieved a positive operating result for the 13th consecutive quarter. 3Q19 demand enabled GOL to achieve an EBIT margin of 18.6% in the quarter, the highest since 2006. Operating income (EBIT) was R$691.9 million in the quarter, R$450.5 million higher than in 3Q18. EBITDA margin was 30.7%, an increase of 11.8 p.p. q-o-q. GOL's 2019 EBIT margin and EBITDA margin guidance is approximately 17% and 29%, respectively.
Balance sheet strengthening:
GOL reported operating cash flow generation of R$1.1 billion in the quarter. Total liquidity was R$4.0 billion, R$369.7 million higher in comparison to June 30, 2019 and R$1.0 billion higher than a year ago. GOL has effected R$935.6 millionin financial debt repayments in 2019. The U.S. Dollar appreciated 4.0% (end of period) against Brazilian Real causing net exchange and monetary variation losses of R$623.3 million. Net debt (excluding perpetual bonds) to LTM EBITDA was 2.9x as of September 30, 2019.
(1) Earnings per diluted share excludes results from (i) exchange variation, net; (ii) Exchangeable Senior Notes and capped calls; and (iii) non-recurring expenses, net.
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