Volaris Reports Financial Results for the First Quarter 2025

Core Insights - Controladora Vuela Compañía de Aviación, S.A.B. de C.V. (Volaris) reported a net loss of $51 million for Q1 2025, a significant decline compared to a net income of $33 million in Q1 2024 [6][7][14] - Total operating revenues decreased by 11.7% to $678 million, primarily due to the depreciation of the Mexican peso and lower revenue per passenger [5][9][11] - The company remains focused on disciplined execution amid geopolitical and economic uncertainties, emphasizing customer demand and sustained profitability [2][3] Financial Performance - Total operating revenues for Q1 2025 were $678 million, down from $768 million in Q1 2024 [5][9] - Total operating expenses increased by 3.6% to $688 million, resulting in an operating loss of $10 million compared to an operating income of $104 million in the previous year [5][6][37] - The average base fare per passenger decreased by 28.8% to $39, while total ancillary revenue per passenger declined by 6.9% to $53 [11][39] Operational Metrics - Available seat miles (ASMs) increased by 6.3% to 8.7 billion, with booked passengers totaling 7.4 million, a 7.1% increase [5][10][34] - The load factor for the quarter was 85.4%, down 1.6 percentage points from the previous year [5][10] - The fleet size at the end of the quarter was 145 aircraft, an increase of 11 from the previous year [5][22] Cost Structure - Total operating expenses per available seat mile (CASM) decreased by 2.5% to $7.88 cents, while CASM excluding fuel increased by 4.5% to $5.40 cents [6][11][33] - The average economic fuel cost decreased by 12.5% to $2.63 per gallon [11][34] - The net debt-to-LTM EBITDAR ratio increased to 2.7x, compared to 2.6x in the previous quarter [6][16] Guidance and Outlook - Volaris has not provided full-year 2025 margin guidance due to ongoing macroeconomic uncertainty but expects ASM growth of 8% to 9% for the full year [18] - For Q2 2025, the company anticipates ASM growth of 9% to 10%, with TRASM projected between $7.4 to $7.5 cents [18][19] - The average USD/MXN exchange rate is expected to be between Ps. 20.20 to 20.40, reflecting a significant depreciation of the Mexican peso [18]