GOL Linhas Aereas Inteligentes S.A.GOL reported air traffic figures for March. Traffic, measured in revenue passenger kilometers (RPK), inched up 0.7% to 2.97 billion.
On a year-over-year basis, consolidated capacity (or available seat kilometers/ASKs) slipped 0.9% to 3.78 billion, primarily due to a 3% decline in domestic capacity. While international RPK climbed 12.9%, domestic RPK slid 0.9% in the month. The carrier however, witnessed a 1.5% decrease in passenger count.
Load factor, percentage of seats filled by passengers, rose to 78.5% from 77.3%, recorded a year ago, as traffic expanded while capacity contracted.
At the end of the first three months of 2018, RPK increased 4.6% while ASK grew 2.2%. Also, load factor for the period improved 190 basis points. However, the company recorded a 0.2% dip in the volume of departures whereas the number of seats occupied by passengers remained flat on a year-to-date basis.
Gol Linhas Aereas Inteligentes S.A. Price
Bullish Q1 Guidance
The carrier expects operating margin of 15-15.5% in first-quarter 2018 compared with the year-ago figure of 9.6%, a year ago. EBITDA margin is projected between 20% and 20.5%. Additionally, passenger unit revenue (PRASK) is anticipated to increase in the band of 10.5-11.0%. This upbeat passenger unit revenue guidance is owing to GOL Linhas' capacity discipline and efficient revenue management strategies.
Notably, capacity is likely to rise around 3% and unit revenue (RASK) to climb between 9.2% and 9.7%. Moreover, non-fuel unit cost (CASK ex-fuel) is predicted to decline approximately 3.5% in comparison to the first quarter of 2017.
Zacks Rank & Key Picks
GOL Linhas carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the airline space are SkyWest, Inc. SKYW , Cathay Pacific Airways Ltd. CPCAY and United Continental Holdings, Inc. UAL , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Shares of SkyWest, Cathay Pacific Airways and United Continental have gained more than 21%, 10% and 8%, respectively, in the last six months.
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