Panama airline Copa, grounded due to pandemic, reports 98% drop in revenue

By Marcelo Rochabrun

Aug 5 (Reuters) - Panama's Copa Airlines CPA.N on Wednesday reported that it earned almost no income between April and June, with revenue falling 98% as coronavirus-related measures virtually shuttered the Panama City airport that serves as its home base.

Panama's tough anti-coronavirus measures, including a travel ban that will go at least through August, has also become a radical test of Copa's resilience. In normal times, Copa is considered Latin America's most financially successful airline, known for steady profits, low debt and a strong cash position.

But in the second quarter, Copa earned only $14 million in revenue but spent $400 million keeping the business running, it said in an earnings release. As a result, it swung to a $386 million net loss from a $50 million profit a year earlier.

Other publicly-traded airlines in Latin America have also faced significant travel bans, especially Colombia's Avianca Holdings AVT_p.CN, but none saw their commercial operations come to a total halt for three months.

Copa said in a statement that its only revenue in the quarter came from "a small number of charters and humanitarian flights."

Together with Avianca, Chilean LATAM Airlines Group LTM.SN filed for bankruptcy protection in May, crushed by looming debt payments, while Copa has so far managed to hold on without significant restructuring.

The airline said it had $308 million in cash at the end of June, largely thanks to a bond issuance that raised $343 million during the quarter.

It now hopes to restart flying on Sept. 4, although tentative restart dates have already been pushed back several times since the pandemic upended air travel in March.

(Reporting by Marcelo Rochabrun; editing by Diane Craft and David Gregorio)

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