GOL Linhas Aereas Inteligentes S.A. (
GOL
)
reported net loss of R$715.1 million (US$364.8 million) in the
second quarter of 2012, much wider than the year-ago loss of
R$358.7 million (US$225.6 million).
The wider loss in the quarter was due to a rise in fuel costs
and landing fees at Brazilian airports. Currency depreciation and
income taxes also added to the woes.
Revenue
Consolidated net revenue was up 16.9% year over year to
R$1,830.7 million (US$1,223.8 million) in the reported quarter.
This increase reflected a rise in consolidated demand as well as in
load factor.
During June 2012, the company???s total load factor was recorded
at 70.5%, up 5 percentage points from June 2011. GOL???s domestic
supply dropped 6.7% from May 2011. Supply on GOL???s international
route network decreased 3.7% year over year. Looking at the
domestic demand side, GOL recorded a 1.4% year-over-year increase
whereas, international demand declined 6.4% year over year. GOL???s
net PRASK increased approximately 7% over the year-ago period.
Exiting the quarter, GOL Linhas had a total fleet of 124
B737-700 and 800 NG aircraft with an average age of 7.3 years, in
addition to 23 B737-300s, with an average age of 20.0 years.
Besides, under an operational leasing contract, the company took
delivery of one aircraft and returned two aircrafts, including one
of Webjet's 737-300s.
Margins
Operating costs and expenses increased 19% year over year to
R$2,185.3 million (US$1,114.9 million) in the reported quarter.
Operating income (EBIT) came in at a negative R$354.6 million
(US$180.9 million), up 31% year over year with a margin of negative
19.4%. A negative EBIT margin of 17.3% was recorded in the
prior-year period.
The company reported EBITDA of negative R$222.6 million
(US$113.6 million), up 23.6% year over year. EBITDA margin came in
at a negative 12.2% compared with negative 11.5% in the second
quarter of 2011.
Balance Sheet
Exiting the second quarter 2012, GOL Linhas' cash and cash
equivalents decreased to R$983.3 million (US$472.7 million) from
R$1314.6 million (US$722.3 million) sequentially. Long-term debt
increased sequentially to R$ 4,627.2 million (US$2,224.5 million)
from R$4,404.2 million (US$2419.9 million).
Further, GOL retains its target of fleet rationalization with a
future fleet plan of 138 in 2012, 136 in 2013 and 140 in 2014.
GOL Linhas, one of the most profitable low-cost airlines in the
world, gives tough competition to other industry players, such as
Copa Holdings SA
(
CPA
),
LAN Airlines S.A
(
LFL
), and
TAM S.A
(
TAM
).
We currently maintain a long-term Neutral recommendation on the
stock. Also, GOL has a Zacks #3 Rank, which translates into a
short-term (1-3 months) Hold rating.
COPA HLDGS SA-A (CPA): Free Stock Analysis
Report
GOL LINHAS-ADR (GOL): Free Stock Analysis
Report
LAN CHILE-ADR (LFL): Free Stock Analysis Report
(TAM): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment
Research