Leading Latin American airline
GOL Linhas Aereas Inteligentes S.A.
) posted dull traffic results for May 2013. However, net
passenger revenue per available seat kilometer (PRASK) for the
month increased 11% year over year.
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Revenue passenger kilometers or RPK - implying revenue generated
per kilometer per passenger - for the month decreased 2.7% from
the year-ago month to 2,739.4 million. Although international RPK
showed an improvement of 40.1%, activities on the domestic land
was low (down 5.6%).
Available seat kilometers (ASK) - that measures an airline's
passenger carrying capacity - slipped 2.7% year over year to
4,144.8 million. Home ground capacity dropped 6.1%, while on the
international front, ASK moved up 39.3%.
Domestic as well as international load factor increased 30 basis
points (bps), while the consolidated load factor remained
unchanged at 66.1%.
For the first five months of 2013, on a consolidated basis, GOL
generated RPK of 13.73 billion (down 10.5% year over year) and
ASK of 20.52 billion (down 8.6% year over year). Load factor was
66.9%, reflecting a decline of 140 bps from the comparable period
The company's not-so-impressive performance was primarily due to
the effects of the transfer of domestic capacity to overseas
routes and the freeze of
The Boeing Company
) 737-300 aircraft services, following the suspension of Webjet
operation, last November.
To cope with the disappointing results, GOL is consistently
taking steps to enhance its operations. The company is in
attempts to increase its operations at Viracopos Airport, in
Campinas. Management plans to start six new daily flights from
the city in Sao Paulo, including five to Santos Dumont/RJ and one
to Brasília, from September. GOL is also contemplating to start
new itinerary between Brazil and Nigeria, in Africa.
We believe that GOL's growth initiatives that include
streamlining of supply, introduction of new routes, expansion of
overseas operations, collaboration with other carriers such as
) and purchase of modern and superior jets will aid the company
to register higher revenue and earnings in the coming months.
GOL - which operates with other industry players such as
Copa Holdings SA
) - has a Zacks Rank #3 (Hold).