Copa Airlines sees robust travel demand across the Americas
It’s getting a little repetitive to talk about what a great quarter Copa Airlines just had. But truth be told, Copa Airlines just had another great quarter, even by its own lofty standards. From July to September, not even especially peak for Panama, Copa’s operating margin reached 24%. And you thought the 18% figure it posted a year ago was good. In the same quarter of 2019, for the record, Copa’s operating margin was 19%. Versus last year, unit revenues declined 4% but on 12% more capacity. Unit costs, meanwhile, dropped 11% thanks largely to cheaper fuel. Copa paid just $3 per gallon for its fuel last quarter compared to $3.81 a year earlier. During an earnings call with analysts, Copa’s management led by longtime CEO Pedro Heilbron said demand conditions were “robust.” This was true for Q3. It’s true for the current quarter. And it’s true for bookings coming in as late as next quarter. The strong US economy is one reason. Also supporting demand are strengthening currencies throughout Latin America. The Mexican peso-to-US dollar rate, for example, averaged close to 17 in Q3, compared to more than 20 a year ago. Even excluding fuel, Copa’s Q3 unit costs declined year-on-year, by about 2%. To achieve cost efficiencies, the airline is introducing new Boeing 737-9s, ending the quarter with a total of 103 planes total, 26 of them -9s. In addition, it’s now selling 70% of its tickets through direct distribution channels. Since the end of last quarter, Copa added Barquisimeto to its network. That’s in Venezuela, an important market because of Panama’s large expatriate Venezuelan population. The country also lacks any major airline competitors, which leaves Copa as its de facto national airline. Prior to Barquisimeto, newly-introduced Copa markets included Austin and Baltimore-Washington in the US, and Manta in Ecuador. In Colombia, Copa operates a low-cost airline called Wingo, which benefitted from the demise of rivals like Viva Air. During Q3, Wingo launched three new routes, one of them linking the capitals of Colombia and Venezuela (Bogota-Caracas). <br/>
https://portal.staralliance.com/cms/news/hot-topics/2023-11-17/star/copa-airlines-sees-robust-travel-demand-across-the-americas
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Copa Airlines sees robust travel demand across the Americas
It’s getting a little repetitive to talk about what a great quarter Copa Airlines just had. But truth be told, Copa Airlines just had another great quarter, even by its own lofty standards. From July to September, not even especially peak for Panama, Copa’s operating margin reached 24%. And you thought the 18% figure it posted a year ago was good. In the same quarter of 2019, for the record, Copa’s operating margin was 19%. Versus last year, unit revenues declined 4% but on 12% more capacity. Unit costs, meanwhile, dropped 11% thanks largely to cheaper fuel. Copa paid just $3 per gallon for its fuel last quarter compared to $3.81 a year earlier. During an earnings call with analysts, Copa’s management led by longtime CEO Pedro Heilbron said demand conditions were “robust.” This was true for Q3. It’s true for the current quarter. And it’s true for bookings coming in as late as next quarter. The strong US economy is one reason. Also supporting demand are strengthening currencies throughout Latin America. The Mexican peso-to-US dollar rate, for example, averaged close to 17 in Q3, compared to more than 20 a year ago. Even excluding fuel, Copa’s Q3 unit costs declined year-on-year, by about 2%. To achieve cost efficiencies, the airline is introducing new Boeing 737-9s, ending the quarter with a total of 103 planes total, 26 of them -9s. In addition, it’s now selling 70% of its tickets through direct distribution channels. Since the end of last quarter, Copa added Barquisimeto to its network. That’s in Venezuela, an important market because of Panama’s large expatriate Venezuelan population. The country also lacks any major airline competitors, which leaves Copa as its de facto national airline. Prior to Barquisimeto, newly-introduced Copa markets included Austin and Baltimore-Washington in the US, and Manta in Ecuador. In Colombia, Copa operates a low-cost airline called Wingo, which benefitted from the demise of rivals like Viva Air. During Q3, Wingo launched three new routes, one of them linking the capitals of Colombia and Venezuela (Bogota-Caracas). <br/>
