TORONTO and FARNHAM, United Kingdom, Aug. 27, 2024 (GLOBE NEWSWIRE) -- Volaris Group Inc. ("Volaris"), today, announced the acquisition of Zupa Tech Limited ("Zupa") and its flagship solution, Caternet. Joining IndiCater Limited ("IndiCater"), a Volaris company, this deal further builds the organizations' leadership in the foodservice and hospitality sector in the UK. Caternet, founded in 2004 by the late Jerry Brand, is a leading provider of catering management solutions, serving a variety of sectors inclu ...

Core Insights - Controladora Vuela Compañía de Aviación, S.A.B. de C.V. (Volaris) released its 2023 Integrated Annual Report titled "Total Vision: Exploring New Perspectives" [1] Company Overview - Volaris is an ultra-low-cost carrier (ULCC) operating point-to-point services in Mexico, the United States, Central, and South America [3] - Since its inception in March 2006, Volaris has expanded its routes from 5 to over 214 and its fleet from 4 to 137 aircraft [3] - The company operates more than 495 daily flight segments connecting 44 cities in Mexico and 29 cities in the United States, Central, and South America [3] - Volaris targets cost-conscious business and leisure travelers, as well as passengers visiting friends and relatives [3] - The company has received the ESR Award for Social Corporate Responsibility for fifteen consecutive years [3]

Volaris reported a 7% decline in revenue in the second quarter, driven by a 17% decline in available seat miles (capacity, in other words). Yield (total revenue per available seat mile, or TRASM) improved 12%, but revenue still missed by about 3%. On the cost side, total costs per available seat mile (or CASM) rose 9% to $0.081, while CASM ex-fuel rose 11% to $0.053. This was better than expected, with the company under-spending in areas like marketing and maintenance (no need to market for grounded flights ...

Financial Data and Key Metrics Changes - The company recorded total operating revenues of $726 million, a decrease of only 7% year-over-year despite a 17% reduction in capacity [27][30] - Net income rose to $10 million, translating to earnings per ADS of $0.09, with cash flow from operating activities at $304 million [29][30] - EBIT increased by 29% to $66 million, with an EBIT margin of 9.1%, while EBITDAR reached $261 million, a 23% increase [54] Business Line Data and Key Metrics Changes - TRASM increased by 12% year-over-year to $0.0889, with a load factor of 85.5% compared to 84.6% a year ago [17] - Ancillary revenues comprised more than 50% of total revenues, with ancillary revenue per passenger rising 15% year-over-year to $53 [43] - The average number of aircraft grounded for engine inspections was 31 during the quarter, with two new A321neo aircraft received [32] Market Data and Key Metrics Changes - The company expects total revenue for the full year of 2024 to be close to 2023 levels, despite a double-digit reduction in capacity [17] - In the US market, increased capacity has bolstered consolidated unit revenue and profitability, with July load factors and fares showing solid improvement [19] - The company anticipates ongoing robust performance in the second half of the year, with bookings indicating trends slightly above expectations [20] Company Strategy and Development Direction - The company is committed to prudent and rational growth, prioritizing profitability as grounded aircraft return to service [13] - The strategy includes shifting ASMs into the cross-border market to maximize profitability, leveraging the unique capacity to convert bus passengers in Mexico [14][24] - The company aims to maintain a competitive advantage through cost control, with approximately 70% of costs being variable [41][54] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the recovery of engine availability and turnaround times, with a forecasted reduction in ASM guidance from a previous estimate [11][39] - The management highlighted the importance of maintaining a stable schedule and improving reliability, leading to fewer cancellations [21] - The company expects to gradually restore capacity while focusing on profitable growth, with no expectation to reach 2023 capacity levels next year [47][93] Other Important Information - The company ended the quarter with a liquidity position of $758 million, representing 23% of the last 12 months' total operating revenues [55] - Average economic fuel costs fell by 4.5% to $9.93 per gallon, while CASM ex-fuel was $0.0525, reflecting a 10.8% increase [56] - The company expects an ASM reduction of around 40% year-over-year for the full year of 2024 [58] Q&A Session Summary Question: Industry's ability to flex up capacity during peak demand periods - Management noted that domestic capacity is constrained in both low and high seasons, with a stable schedule implemented throughout the year [63] Question: Full year capacity expectations - Management confirmed that the capacity reduction is primarily due to the ability to acquire new spare engines, with expectations of 32 engines returning in the second half of the year [87] Question: Insights on servicing the Tulum airport - Operations at Tulum airport are still in the early stages, with flights expected to start later in the fourth quarter [109] Question: v.club membership performance - The v.club membership accounts for about 15% of sales, with a focus on building customer loyalty and repeat business [118] Question: Maintenance costs normalization - Management indicated that maintenance costs are expected to normalize, with timing being a key factor in quarterly fluctuations [122]

Second Quarter 2024 Highlights 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 ...

[Annex - Financial Derivative Instruments](index=2&type=section&id=Annex%20-%20Financial%20Derivative%20Instruments) This annex details the company's policies, markets, valuation, liquidity, and quantitative information regarding its financial derivative instruments [Management's Discussion on Derivative Policies](index=2&type=section&id=Management's%20Discussion%20on%20Derivative%20Policies) Volaris uses derivatives solely for hedging financial risks, managed by a dedicated team under a conservative policy - Volaris uses derivatives solely for hedging financial risks (fuel price, foreign currency, interest rate), not for speculation[2](index=2&type=chunk)[5](index=5&type=chunk) - A Risk Management team and Hedging Policy, approved by Corporate Governance, are in place to manage these risks[3](index=3&type=chunk)[4](index=4&type=chunk) - As of the report date, Volaris does not hold fuel or foreign exchange derivative financial instruments, but maintains interest rate CAPs for Asset Backed Trust Notes[6](index=6&type=chunk) [Trading Markets and Eligible Counterparties](index=3&type=section&id=Trading%20Markets%20and%20Eligible%20Counterparties) The company conducts OTC derivative transactions with robust counterparties, using ISDA agreements to mitigate risk - Volaris operates only in OTC markets and uses ISDA agreements with financially strong counterparties to minimize risk[7](index=7&type=chunk)[8](index=8&type=chunk) ISDAs and Q2 2024 Activity | Metric | Value | | :--- | :--- | | ISDAs in place (June 30, 2024) | 8 | | Q2 2024 activity | None | [Valuation Techniques](index=3&type=section&id=Valuation%20Techniques) Derivatives are valued at fair value using financial institution data and internal models, classified as effective hedges - Derivatives are valued at fair value using financial institution valuations and internal methodologies, with Bloomberg as a primary data source[9](index=9&type=chunk) - All derivative financial instruments are considered effective and classified under hedge accounting assumptions in accordance with IFRS[10](index=10&type=chunk) [Liquidity Sources for Derivatives](index=3&type=section&id=Liquidity%20Sources%20for%20Derivatives) Volaris manages derivative liquidity by diversifying contracts with CSAs and maintaining internal resources - Derivative contracts are distributed among multiple counterparties with CSAs and varied maturities to optimize financial conditions and minimize margin calls[11](index=11&type=chunk) - Internal resources are available to meet derivative-related liquidity requirements if needed[11](index=11&type=chunk) [Changes in Risk Exposure and Contingencies](index=3&type=section&id=Changes%20in%20Risk%20Exposure%20and%20Contingencies) No significant changes in exposure to fuel price, exchange rate, or interest rate risks observed in Q2 2024 - No significant changes in exposure to fuel price, exchange rate, or interest rate risks were observed in Q2 2024[12](index=12&type=chunk) [Quantitative Information on Derivatives](index=3&type=section&id=Quantitative%20Information%20on%20Derivatives) All derivatives qualify for hedge accounting, fair value changes reflect only underlying asset price movements - All derivatives held qualify as hedge accounting, with fair value changes reflecting only underlying asset price movements[13](index=13&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=4&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations of the company's business, accounting policies, financial instruments, and other significant financial disclosures - Interim financial statements are prepared in accordance with IAS 34 and IFRS, using consistent accounting policies as annual statements[15](index=15&type=chunk)[174](index=174&type=chunk) - The functional and presentation currency for the Company and its main subsidiary (Concesionaria) is the US dollar[17](index=17&type=chunk)[176](index=176&type=chunk) [Description of the Business](index=22&type=section&id=Description%20of%20the%20Business) Volaris is an ultra-low-cost carrier operating in Mexico, the US, Central, and South America, with its concession extended - Volaris is an ultra-low-cost carrier operating in Mexico, the US, Central, and South America[159](index=159&type=chunk)[160](index=160&type=chunk)[367](index=367&type=chunk) - Concesionaria's air transportation concession was extended for 20 years, effective May 9, 2020[161](index=161&type=chunk) - Volaris is dual-listed on NYSE (VLRS) and BMV (VOLAR) since September 2013[163](index=163&type=chunk) [Summary of Material Accounting Policies](index=4&type=section&id=Summary%20of%20Material%20Accounting%20Policies) This section details the key accounting policies for interim financial statements, adhering to IAS 34 and IFRS, with US dollar as functional currency - Interim financial statements are prepared in accordance with IAS 34 and IFRS, using consistent accounting policies as annual statements[15](index=15&type=chunk)[174](index=174&type=chunk) - The functional and presentation currency for the Company and its main subsidiary (Concesionaria) is the US dollar[17](index=17&type=chunk)[176](index=176&type=chunk) [Basis of Preparation](index=4&type=section&id=Basis%20of%20Preparation) Interim financial statements are prepared under IAS 34 and IFRS, using US dollar as functional currency and management estimates - Interim financial statements are prepared in accordance with IAS 34 and IFRS, using consistent accounting policies as annual statements[15](index=15&type=chunk)[174](index=174&type=chunk) - The functional and presentation currency for the Company and its main subsidiary (Concesionaria) is the US dollar[17](index=17&type=chunk)[176](index=176&type=chunk) - Financial statements are prepared under the historical-cost convention, with derivatives measured at fair value[19](index=19&type=chunk)[178](index=178&type=chunk) - Preparation requires management estimates and assumptions, which may lead to actual results differing from reported amounts[20](index=20&type=chunk)[179](index=179&type=chunk) [Basis of Consolidation](index=4&type=section&id=Basis%20of%20Consolidation) Consolidated financial statements include 100%-owned subsidiaries, defining control by power over investee and variable returns, with intercompany eliminations - Consolidated financial statements include the Company and its 100%-owned subsidiaries in Mexico, Costa Rica, Guatemala, and El Salvador[21](index=21&type=chunk)[22](index=22&type=chunk)[180](index=180&type=chunk)[181](index=181&type=chunk) - Control is defined by power over the investee, exposure to variable returns, and the ability to affect those returns[24](index=24&type=chunk)[183](index=183&type=chunk) - Intercompany balances and transactions are fully eliminated upon consolidation[25](index=25&type=chunk)[185](index=185&type=chunk) [Revenue Recognition](index=6&type=section&id=Revenue%20Recognition) Passenger and non-passenger revenues are recognized upon service provision or ticket expiration, with net revenue for agent-based services - Passenger revenues are recognized upon service provision or ticket expiration; non-passenger revenues upon service provision[27](index=27&type=chunk)[29](index=29&type=chunk)[32](index=32&type=chunk) - For partner airline segments and certain third-party services, Volaris acts as an agent, recognizing net revenue[31](index=31&type=chunk)[33](index=33&type=chunk) - Tickets are non-refundable, but cancellations attributable to the airline offer flight changes, refunds, or vouchers; revenue is recognized when vouchers are redeemed or expire[40](index=40&type=chunk) [Cash, Cash Equivalents and Restricted Cash](index=7&type=section&id=Cash,%20Cash%20Equivalents%20and%20Restricted%20Cash) Cash and cash equivalents are highly liquid investments with short maturities, while restricted cash is held for debt service reserves - Cash and cash equivalents are highly liquid investments with maturities of 90 days or less[43](index=43&type=chunk) - Restricted cash is specifically for debt service reserves and is not available for other uses[45](index=45&type=chunk)[274](index=274&type=chunk) [Short-Term Investments](index=8&type=section&id=Short-Term%20Investments) Short-term investments consist of fixed-term bank deposits with maturities ranging from 3 to 12 months - Short-term investments are fixed-term bank deposits maturing in 3-12 months[46](index=46&type=chunk) [Financial Instruments Initial Recognition and Subsequent Measurement](index=8&type=section&id=Financial%20Instruments%20Initial%20Recognition%20and%20Subsequent%20Measurement) Financial assets are classified and measured per IFRS 9 at fair value, while liabilities are at amortized cost, with specific derecognition criteria - Financial assets are classified and measured per IFRS 9, based on cash flows and business model, and initially recognized at fair value[48](index=48&type=chunk)[49](index=49&type=chunk) - Financial liabilities are initially recognized at fair value and subsequently measured at amortized cost for loans and payables[56](index=56&type=chunk)[57](index=57&type=chunk)[58](index=58&type=chunk) - A financial asset is derecognized when rights to cash flows expire or are transferred, and risks/rewards or control are substantially transferred[50](index=50&type=chunk) - Financial liabilities are derecognized when obligations are discharged, cancelled, or expire, or if terms are substantially modified[61](index=61&type=chunk) [Other Accounts Receivable](index=10&type=section&id=Other%20Accounts%20Receivable) Receivables primarily from credit card processors are non-interest bearing, short-term, and valued at cost less allowances

volaris + Conclusion: Volaris Remains Undervalued Volaris Revenues Grow As Company Manages Capacity | --- | --- | --- | --- | --- | --- | --- | |--------------------------------|-------|------------|----------------------|------------|------------------------|-------| | -10 \nTotal Operating Revenues | | TRASM | trate \nCASM ex fuel | | EBIT | | | USD $768M | | USD 9.34c | USD 5.16c | | USD $104M | | | 11 | | | | | | | | EBITDAR | | Net Income | Liquidity | 22% of LTM | Net Debt / LTM EBITDAR | | | USD $235 ...

Passengers: The total number of passengers booked on all flight segments. Media Contact Israel Álvarez / ialvarez@gcya.net MEXICO CITY, July 08, 2024 (GLOBE NEWSWIRE) -- Controladora Vuela Compañía de Aviación, S.A.B. de C.V. (NYSE: VLRS and BMV: VOLAR) ("Volaris" or "the Company"), the ultra-low-cost carrier (ULCC) serving Mexico, the United States, Central, and South America, reports its June 2024 preliminary traffic results. The information included in this report has not been audited and does not provid ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 20-F ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT O ...

Controladora Vuela Compañía de Aviación, S.A.B. de C.V. (NYSE:VLRS) Q1 2024 Results Conference Call April 23, 2024 11:00 AM ET Company Participants Ricardo Martinez - Investor Relations Director Enrique Javier Beltranena Mejicano - President and Chief Executive Officer Holger Blankenstein - Executive Vice President, Airline Commercial and Operations Jaime Esteban Pous Fernandez - Chief Financial Officer Conference Call Participants Duane Pfennigwerth - Evercore ISI Stephen Trent - Citi Michael Linenberg - D ...