Copa Holdings Reports Net Income of US$86.6 Million for the Fourth Quarter of 2012 and US$326.5 Million for Full Year 2012

Copa Holdings Reports Net Income of US$86.6 Million for the Fourth Quarter of
                 2012 and US$326.5 Million for Full Year 2012

PR Newswire

PANAMA CITY, Feb. 6, 2013

PANAMA CITY, Feb. 6, 2013 /PRNewswire/ -- Copa Holdings, S.A. (NYSE: CPA),
today announced financial results for the fourth quarter of 2012 (4Q12) and
full year 2012. The terms "Copa Holdings" or "the Company" refers to the
consolidated entity. The following financial information, unless otherwise
indicated, is presented in accordance with International Financial Reporting
Standards (IFRS). See the accompanying reconciliation of non-IFRS financial
information to IFRS financial information included in financial tables section
of this earnings release. Unless otherwise stated, all comparisons with prior
periods refer to the fourth quarter of 2011 (4Q11).

OPERATING AND FINANCIAL HIGHLIGHTS

  oCopa Holdings reported net income of US$86.6 million for 4Q12 or earnings
    per share (EPS) of US$1.95, as compared to net income of US$104.4 million
    or EPS of US$2.36 in 4Q11. Excluding special items, Copa Holdings
    reported an adjusted net income of US$89.3 million or adjusted EPS of
    $2.01, compared to adjusted net income of US$85.3 million or adjusted EPS
    of $1.93 in 4Q11.
  oNet income for full year 2012 reached US$326.5 million or EPS of US$7.35,
    compared to US$310.4 million or EPS of US$6.98 for full year 2011.
    Excluding special items, however, Copa Holdings would have reported an
    adjusted net income of US$336.1 million or EPS of US$7.57, compared to
    adjusted net income of US$314.1 or adjusted EPS of $7.06 for full year
    2011.
  oOperating income for 4Q12 came in at US$104.3 million, representing a 6.5%
    decline from operating income of US$111.5 million in 4Q11, mainly as a
    result of a 3.7% drop in unit operating revenue per available seat mile
    (RASM) and a 6.3% increase in the all-in price of jet fuel. As a result,
    operating margin for 4Q12 came in at 17.4%, or 4.5 percentage points below
    4Q11.
  oThe Company reported operating income of US$402.5 million for full year
    2012, representing an increase of 4.6% over operating income of US$385.0
    million in 2011. Operating margin for full year 2012 came in at 17.9%, as
    compared to an operating margin of 21.0% in 2011.
  oTotal revenues for 4Q12 increased 17.7% to US$599.8 million. Yield per
    passenger mile decreased 4.1% to 17.1 cents and RASM came in at 13.5
    cents, or 3.7% below 4Q11. However, on a quarter over quarter basis, both
    yields and RASM remained relatively flat over our third quarter high
    season, declining only 0.9% and 0.2%, respectively.
  oFor 4Q12 consolidated passenger traffic grew 23.7%, led by international
    traffic growth which expanded a robust 26.0%. At the same time,
    consolidated capacity grew 22.3%, led by a 24.4% increase in international
    capacity. As a result, consolidated load factor for the quarter increased
    0.8 percentage points to 75.7%. For full year 2012, consolidated load
    factor came in at 75.4%, down 0.9 percentage points from 2011, on 24.1%
    capacity growth.
  oOperating cost per available seat mile (CASM) increased 1.8%, from 11.0
    cents in 4Q11 to 11.1 cents in 4Q12 as a result of an increase in the
    all-in price of jet fuel. However, CASM excluding fuel cost decreased
    1.3% from 6.9 cents in 4Q11 to 6.8 cents in 4Q12, as a result of lower
    labor, maintenance and distribution unit costs, which were partly offset
    mainly by higher passenger servicing costs and other administrative
    expenses.
  oCash, short term and long term investments ended 2012 at US$720.5 million,
    representing 32% of the last twelve months' revenues.
  oDuring the fourth quarter, Copa Airlines took delivery of two Boeing
    737-800s and returned one leased Boeing 737-800 aircraft. As a result,
    Copa Holdings ended the year with a consolidated fleet of 83 aircraft,
    composed of 18 Boeing 737-700s, 39 Boeing 737-800s and 26 Embraer-190s.
  oDuring the fourth quarter, Copa Holdings and Boeing agreed to reschedule
    four future B737-800 aircraft deliveries (2 firm and 2 options). As a
    result, the company now has eight firm deliveries of Boeing 737-800
    aircraft and four lease expirations of B737-700 aircraft for 2014.
  oFor 2012, Copa Holdings reported on-time performance of 85.5% and a
    flight-completion factor of 99.6%, maintaining its position among the best
    in the industry.

Subsequent Events

  oIn January 2013, Copa Holdings completed the sale-leaseback of eight
    Boeing 737-800 aircraft, four of which involve 2013 deliveries and four
    involving 2014 deliveries. The sale-leaseback transactions for the 2013
    deliveries were closed with MC Aviation Partners, the aircraft leasing arm
    of Mitsubishi Corporation, and the sale-leaseback transactions for the
    2014 deliveries were closed with SMBC Aviation Capital.
  oEffective March 15, 2013, and after 17 years of valuable service, Copa
    Holdings' CFO, Mr. Victor Vial, will be resigning. Mr. Vial will continue
    to be involved with the company as an advisor to the Board of Directors.
    The company is currently undergoing a selection process to appoint a new
    CFO.

Consolidated Financial  4Q12   Variance vs. Variance vs. FY 2012 Variance vs.
& Operating Highlights         4Q11         3Q12                 2011
Revenue Passengers      1,899  17.8%        1.6%         7,140   13.5%
Carried ('000)
RPMs (mm)              3,366  23.7%        2.2%         12,499  22.6%
ASMs (mm)              4,447  22.3%        1.8%         16,567  24.1%
Load Factor            75.7%  0.8p.p.      0.4%         75.4%   -0.9p.p.
Yield                   17.1   -4.1%        -0.9%        17.3    1.0%
PRASM (US$ Cents)      12.9   -3.0%        -0.5%        13.1    -0.2%
RASM (US$ Cents)       13.5   -3.7%        -0.2%        13.6    -1.0%
CASM (US$ Cents)       11.1   1.8%         2.2%         11.1    2.9%
CASM Excl. Fuel (US$    6.8    -1.3%        2.1%         6.8     0.5%
Cents)
Breakeven Load Factor   61.6%  2.6p.p.      1.8p.p.      61.3%   1.4p.p.
^(1)
Fuel Gallons Consumed   58.4   23.3%        1.3%         219.5   24.4%
(Millions)
Avg. Price Per Fuel     3.34   6.3%         3.0%         3.31    6.6%
Gallon (US$ Dollars)
Average Length of Haul  1,772  5.0%         0.6%         1,751   8.0%
(Miles)
Average Stage Length    1,090  2.2%         0.6%         1,076   5.8%
(Miles)
Departures              29,555 15.9%        0.7%         112,551 12.7%
Block Hours             83,146 21.4%        1.3%         313,321 22.6%
Average Aircraft        11.0   5.4%         -1.7%        10.9    4.4%
Utilization (Hours)
Operating Revenues (US$ 599.8  17.7%        1.6%         2,249.4 22.9%
mm)
Operating Income (US$   104.3  -6.5%        -8.6%        402.5   4.6%
mm)
Operating Margin       17.4%  -4.5p.p.     -1.9p.p.     17.9%   -3.1p.p.
Net Income (US$ mm)     86.6   -17.0%       -22.6%       326.5   5.2%
Adjusted Net Income     89.3   4.7%         -8.5%        336.1   7.0%
(US$ mm) ^(1)
EPS - Basic and Diluted 1.95   -17.2%       -22.6%       7.35    5.4%
(US$)
Adjusted EPS - Basic    2.01   4.4%         -8.6%        7.57    7.2%
and Diluted (US$) ^(1)
# of Shares - Basic and 44,409 0.2%         0.0%         44,400  -0.2%
Diluted ('000)

^(1^) Breakeven Load Factor, Adjusted Net Income and Adjusted EPS for 4Q12,
4Q11, and 3Q12 exclude non-cash charges/gains associated with the
mark-to-market of fuel hedges.

Note: Attached to this press release is a reconciliation of non-IFRS
financial measures to the comparable IFRS measures.

FULL 4Q12 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT:
http://investor.shareholder.com/copa/results.cfm

4Q12 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST

Date:                        February 7, 2013
Time:                        11:00 AM US ET (11:00 AM Local Time)
Conference telephone         877-293-5456 (US Domestic Callers)
number:
                             707-287-9357(International Callers)
Webcast:                     http://investor.shareholder.com/copa/events.cfm
Speakers:                    Pedro Heilbron, Chief Executive Officer
                             Victor Vial, Chief Financial Officer

Copa Holdings is a leading Latin American provider of passenger and cargo
services. The Company, through its operating subsidiaries, provides service
to 64 destinations in 29 countries in North, Central and South America and the
Caribbean with one of the youngest and most modern fleets in the industry,
consisting of 83 aircraft: 57 Boeing 737NG aircraft and 26 EMBRAER-190s. For
more information visit www.copaair.com.

This release includes "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are based on current plans, estimates and expectations, and are not
guarantees of future performance. They are based on management's expectations
that involve a number of business risks and uncertainties, any of which could
cause actual results to differ materially from those expressed in or implied
by the forward-looking statements. The Company undertakes no obligation to
update or revise any forward-looking statement. The risks and uncertainties
relating to the forward-looking statements in this release are among those
disclosed in Copa Holdings' filed disclosure documents and are, therefore,
subject to change without prior notice.

CPA-G



CopaHoldings, S.A.
Income Statement - IFRS
(US$ Thousands)
                  Unaudited   Unaudited   %       Unaudited   %       Unaudited   Audited     %
                  4Q12        4Q11        Change  3Q12        Change  2012        2011        Change
Operating
Revenues
Passenger         575,731     485,324     18.6%   568,564     1.3%    2,163,136   1,747,102   23.8%
Revenue
Cargo, mail and   24,109      24,125      -0.1%   21,884      10.2%   86,252      83,819      2.9%
other
Total Operating   599,839     509,449     17.7%   590,448     1.6%    2,249,388   1,830,921   22.9%
Revenue
Operating
Expenses
Aircraft fuel     194,754     148,678     31.0%   186,844     4.2%    725,763     547,221     32.6%
Salaries and      65,782      57,854      13.7%   62,964      4.5%    247,405     213,094     16.1%
benefits
Passenger         59,788      45,903      30.2%   56,973      4.9%    217,137     160,725     35.1%
servicing
Commissions       22,382      19,750      13.3%   23,501      -4.8%   89,378      72,947      22.5%
Reservations and  22,112      18,813      17.5%   22,203      -0.4%   84,992      70,363      20.8%
sales
Maintenance,
material and      24,311      22,323      8.9%    23,370      4.0%    92,166      70,969      29.9%
repairs
Depreciation      24,446      19,727      23.9%   23,031      6.1%    89,217      75,458      18.2%
Flight            27,747      22,251      24.7%   27,217      1.9%    104,993     83,782      25.3%
operations
Aircraft rentals  19,472      15,573      25.0%   18,504      5.2%    72,468      51,259      41.4%
Landing fees and  12,266      10,388      18.1%   12,190      0.6%    46,233      41,881      10.4%
other rentals
Other             22,510      16,684      34.9%   19,561      15.1%   77,101      58,237      32.4%
Total Operating   495,570     397,943     24.5%   476,359     4.0%    1,846,852   1,445,936   27.7%
Expense
Operating Income  104,269     111,506     -6.5%   114,089     -8.6%   402,535     384,985     4.6%
Non-operating
Income
(Expense):
Interest expense  (8,130)     (8,808)     -7.7%   (8,124)     0.1%    (32,795)    (32,680)    0.4%
Interest income   3,427       2,152       59.2%   3,235       5.9%    11,689      6,774       72.6%
Other, net        (2,721)     11,605      nm      13,750      nm      (15,086)    (13,068)    15.4%
Total
Non-Operating     (7,424)     4,950       nm      8,861       nm      (36,192)    (38,974)    -7.1%
Income/(Expense)
Income before     96,845      116,456     -16.8%  122,951     -21.2%  366,343     346,011     5.9%
Income Taxes
Provision for     10,222      12,073      -15.3%  11,033      -7.4%   39,867      35,586      12.0%
Income Taxes
Net Income        86,623      104,383     -17.0%  111,917     -22.6%  326,476     310,425     5.2%
EPS - Basic and   1.95        2.36        -17.2%  2.52        -22.6%  7.35        6.98        5.4%
Diluted
Shares - Basic    44,409,211  44,314,505  0.2%    44,406,679  0.0%    44,400,224  44,493,779  -0.2%
and Diluted



Copa Holdings, S.A.
Balance Sheet - IFRS
(US$ Thousands)             December 31,     September 30,     December 31,
                            2012             2012              2011
                            (Unaudited)    (Unaudited)     (Audited)
Current Assets:
Cash and cash equivalents   166,265          $    282,642   $  243,801
Short-term investments      484,838          441,349           262,345
Total cash, cash
equivalents and short-term  651,103          723,991           506,146
investments
Accounts receivable, net
of allowance for doubtful   135,207          143,057           142,297
accounts
Accounts receivable from    1,129            505               704
related parties
Expendable parts and
supplies, net of allowance  50,603           51,292            42,382
for obsolescence
Prepaid expenses            63,120           49,745            40,058
Other current assets        16,328           17,964            22,655
Total Current Assets        917,490          986,554           754,242
Long-term investments       69,445           71,500            104,834
Property and Equipment:
Owned property and
equipment:
Flight equipment            2,405,346        2,346,637         2,036,983
Other equipment             66,330           63,757            67,577
                            2,471,676        2,410,394         2,104,560
Less: Accumulated           (432,589)        (408,965)         (346,656)
depreciation
                            2,039,087        2,001,429         1,757,904
Purchase deposits for       245,544          163,696           242,287
flight equipment
Total Property and          2,284,631        2,165,125         2,000,191
Equipment
Other Assets:
Net pension asset           10,009           9,685             8,974
Goodwill                    27,575           27,081            25,099
Intangible asset            59,382           57,537            47,047
Other assets                114,933          120,776           125,409
Total Other Assets          211,899          215,079           206,529
Total Assets                $  3,483,465   $   3,438,258   $  3,065,796
LIABILITIES AND
SHAREHOLDER'S EQUITY
Current Liabilities:
Current maturities of       $    136,268  $    118,387  $   131,069
long-term debt
Accounts payable            104,975          105,609           92,842
Accounts payable to         20,255           14,765            22,074
related parties
Air traffic liability       382,807          360,223           297,135
Taxes and interest payable  85,436           86,174            71,223
Accrued expenses payable    48,047           45,753            30,472
Other current liabilities   10,902           9,897             13,845
Total Current Liabilities   788,690          740,808           658,660
Non-Current Liabilities:
Long-term debt              1,069,836        1,067,549         936,657
Post employment benefits    6,340            6,286             5,847
liability
Other long-term             43,726           44,635            44,657
liabilities
Deferred tax liabilities    38,329           31,888            30,444
Total Non-Current           1,158,231        1,150,358         1,017,605
Liabilities
Total Liabilities           1,946,921        1,891,166         1,676,265
Shareholders' Equity:
Class A - 33,391,400
shares issued and           22,591           22,496            22,495
outstanding
Class B - 10,938,125
shares issued and           7,466            7,466             7,466
outstanding
Additional paid in capital  40,660           38,977            33,567
Retained earnings           1,458,258        1,471,258         1,324,394
Accumulated other
comprehensive income        7,569            6,895             1,609
(loss)
Total Shareholders' Equity  1,536,544        1,547,092         1,389,531
Total Liabilities and       $  3,483,465   $   3,438,258   $  3,065,796
Shareholders' Equity

Copa Holdings, S.A.

NON-IFRS FINANCIAL MEASURE RECONCILIATION

This press release includes the following non IFRS financial measures: CASM
Excluding Fuel, Adjusted Net Income and Adjusted EPS. This supplemental
information is presented because we believe it is a useful indicator of our
operating performance and is useful in comparing our performance with other
companies in the airline industry. These measures should not be considered in
isolation, and should be considered together with comparable IFRS measures, in
particular operating income and net income. The following is a reconciliation
of these non-IFRS financial measures to the comparable IFRS measures:





Reconciliation of Net Income
Excluding Special Items        4Q12     4Q11      3Q12      2012      2011
Net income as Reported         $86,623  $104,383  $111,917  $326,476  $310,425
Special Items (adjustments):
 Unrealized (gain) loss
on fuel hedging instruments    2,673    (19,069)  (14,277)  9,577     3,634
(1)
 Other Special Items, net   -        -         -                   -
(2)
Adjusted Net Income            $89,296  $85,314   $97,640   $336,053  $314,059
Shares used for Computation
(in thousands)
 Basic and Diluted          44,409   44,315    44,407    44,400    44,494
Adjusted earnings per share
 Basic and Diluted         2.01     1.93      2.20      7.57      7.06
Reconciliation Operating
Costs per ASM
Excluding Fuel and Special     4Q12     4Q11      3Q12      2012      2011
Items
Operating Costs per ASM as     11.1     10.9      10.9      11.1      10.8
Reported
Aircraft fuel per ASM          (4.4)    (4.1)     (4.3)     (4.4)     (4.1)
Operating Costs per ASM        6.8      6.9       6.6       6.8       6.7
excluding fuel

FOOTNOTES:

(1) Include unrealized gains resulting from the mark-to-market accounting
for changes in the fair value of fuel hedging instruments.

SOURCE Copa Holdings, S.A.

Website: http://www.copaair.com
Contact: Copa Holdings S.A., Investor Relations: (507) 304-2677,
www.copaair.com (IR section)
 
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