SÃO PAULO, April 13, 2021
/PRNewswire/ -- GOL Linhas Aéreas Inteligentes S.A. (NYSE: GOL
and B3: GOLL4), ("GOL" or "Company"), Brazil's largest airline, today provides its
Investor Update for March/21. All information is presented
in Brazilian Reais (R$). The information below is preliminary and
unaudited.
In this period, GOL adjusted its capacity to an average of 245
flights per day, a 31% decrease from an average of 355 flights
in February/21. The Company operated approximately 381 daily
flights on peak days. GOL's consolidated gross revenues for the
month were R$300 million and the
average load factor was 71.8%, highlighting Management's on-going
focus on maintaining sustainable operations through the continuous
matching of seat supply to the level of traveler demand.
In March/21, there was a 25% decrease in the search for the
Company's airline tickets, compared to February/21, with a 40%
reduction in the volume of daily sales during that month, due to
the decline in travel demand as a consequence of the increase in
cases of Covid-19 in Brazil,
combined with the transition to the low season.
Brazil recently experienced a
"second wave" of Covid-19 cases with pressure on its hospital
network. In response to the increase in the number of cancellations
and no-shows, GOL's airline network was quickly adjusted to match
costs to the new level of inflows and had a 29% reduction between
the first and the fourth weeks of March. PRASK was R$15.45 cents, a decrease of 19% over February/21
and a year-on-year variation of -23% due to the greater reduction
in fares by industry peers to sustain their higher level of
capacity.
"During this challenging second wave of Covid-19 cases in
Brazil, we remain diligently
focused on Safety for our Customers and Employees," said Paulo
Kakinoff, Chief Executive Officer. "We have strong hygiene
protocols in place and the flexibility to rapidly readjust our
network. We reiterate our belief that, even with the non-linear
resumption of demand, the Company will emerge stronger and even
more resilient as markets start to normalize."
Anticipating a Recovery Aligned to Brazil's Vaccine Roll-out
Since the
beginning of the pandemic, there has been a high correlation
between the reduction of the Covid-19 case curve and a recovery in
domestic demand for air travel. GOL witnessed these fluctuations in
demand during August and September last year and rapidly adjusted
its network accordingly to the demand scenario during that period.
European countries and the United
States have an earlier vaccination schedule than
Brazil, which is also providing an
indicator for what resumption in travel demand could look like.
In the United States, TSA
(Transportation Security Administration) throughput bottomed
out at the end of January 2021 at
around 35% of 2019 levels as Covid-19 cases peaked in the United States' "second wave". In just two
months since the low point, the TSA throughput has rebounded to
over 60% of 2019 levels. Similarly, last week when Brazil hit its peak of Covid-19 cases in its
"second wave", GOL's passengers as a percentage of 2019 bottomed
out at around 35%. Therefore, the Company expects that as the
Covid-19 daily new cases curve begins to invert and there is a
recovery in the Brazilian GDP, it will see an acceleration in
searches for GOL's tickets and level of sales.
GOL's Management is therefore paying close attention to
Brazil's National Immunization
Program. Currently, the Ministry of Health of Brazil has contracted approximately 500
million doses of Covid-19 vaccines, and another 140 million doses
are under negotiation. The forecast is that approximately 150
million doses will be administered by the end of 2Q21, which is
sufficient to immunize all priority groups and individuals over 60
years old, while the remainder of the population is expected to be
immunized during 2H21.
As of last week, Brazil had
administered at least one shot of the vaccine to over 25 million
people and is fast approaching a pace of one million doses per day.
Currently, Brazil ranks fifth in
the world in the pace of daily vaccinations. To help speed up
Brazil's National Immunization
Program, since January 17, 2021, GOL
is making space on its aircraft available free of charge for the
transportation of Covid-19 vaccines.
The Company anticipates that the successful roll-out of
vaccinations through Brazil's
National Immunization Program will reactivate demand in the leisure
and corporate segments as of the middle of the second quarter of
2021. During the first 10 days of April, there has already been a
reduction in the number of hospitalizations for the
70-years-and-above age cohort, who are currently eligible to be
vaccinated. However, given that the number of cases of Covid-19 in
Brazil are at high levels, GOL's
Management continues to consider more conservative recovery
scenarios, maintaining initiatives to reduce costs, preserve cash
flow equilibrium and the match of supply to reduced levels of
demand.
GOL estimates that it has sufficient liquidity to
finance its working capital, expenses and debt service through
the coming months, a period of higher impact on its cash flow. The
Company ended March with approximately R$1.9 billion in total liquidity. Including the
financeable amounts of deposits and unencumbered assets, GOL's
potential liquidity sources total over R$5
billion. Excluding financial debt service, GOL's net cash
consumption was neutral in March.
Richard Lark, Chief Financial
Officer, added: "Throughout the pandemic we have protected our
balance sheet by reducing our costs, met our financial obligations
provided for in our cash flow and taken advantage of the capital
markets at the right time. As such, our liquidity remains in line
with where it was in April/20 and is adequate to manage the
operations until the percentage of the immunized population
increases. We are therefore confident in our Management team's
ability to effectively manage operations through this second wave,
until we see a recovery in travel demand following the vaccine
roll-out."
Corporate Reorganization Approved by Shareholders of GOL and
Smiles
On March 24, 2021,
shareholders of GOL and the majority of Smiles' minority
shareholders approved, in extraordinary meeting, the corporate
reorganization to combine the Company's two operating subsidiaries:
GLA ("GOL Linhas Aéreas"), the largest domestic airline in
Brazil, and Smiles, the leading
loyalty and mileage program. GOL believes the transaction is an
important milestone to maximize future value. Importantly, once the
merger is completed both companies will be better positioned to
increase their respective market competitiveness and cash flow
generation.
The successful completion of this transaction will substantially
reduce the risks that each company faces in this pandemic and will
provide operating and financial synergies. As a combined entity,
GOL will be better able to improve revenue management, more
dynamically manage the inventory of seats, improve its ability to
coordinate marketing to Customers and be better positioned to
optimize yields.
In addition, GOL will be able to manage costs more efficiently
across the businesses and have the proper structure to maximize the
cash flow of the combined companies. GOL expects annualized
run-rate synergies to exceed R$400
million once all of the operating and financial gains are
fully realized. This merger accompanies the changes to the business
environment in which the Company operates today and positions the
GOL Group to maximize value in a post Covid-19 operating
environment.
On March 25, 2021, the Company
announced through its subsidiary, Smiles Fidelidade S.A., the
distribution of R$500 million in
dividends to be paid on April 16,
2021. As a result, the value of the exchange ratio will be
automatically adjusted, and the portion due in national currency
will be reduced accordingly. Information for exercising the option
for the optional exchange ratio, the establishment of the base date
for determining the shareholders who shall migrate to GOL's
shareholder base, as well as the credit date for the shares and
payment of the redeemable preferred shares shall be timely
disclosed in the respective notice of confirmation.
Maintaining Cash Flow Equilibrium and Managing
Costs
Based on conservative assumptions and to provide the
necessary matching of assets and liabilities in this cooling demand
environment, GOL has been implementing measures to minimize net
cash consumption and to maintain equilibrium in its operating cash
flow. The Company continues to work daily with its main
stakeholders to manage through this second wave of Covid-19 in
Brazil.
Since the beginning of 2020, GOL has amortized more than
R$4.1 billion of financial debt and
kept operating liabilities stable. This will reflect on the
recovery of the solidity of its capital structure. The average
maturity of the Company's long-term debt, excluding aircraft leases
and perpetual notes, is 3.3 years.
GOL Management fully honored its commitments with the global
capital markets and the Company was the only airline in
Latin America to have returned
capital to investors in 2020. GOL expects these actions will
continue to define it, and the Company counts on the continued
support and confidence of its stakeholders and partners to invest
in the recovery of the Brazilian market.
At the same time, GOL continues to effectively manage its
operations to maintain cost leadership. During the first half of
2021, GOL expects to maintain personnel costs at their reduced
position, to around 50% of pre-pandemic levels. Having
converted a significant portion of fixed payroll and fleet costs
into variable costs, the Company is well-positioned to preserve the
equilibrium of its nominal costs equivalent to the level of its
offered capacity and to expand its unit cost leadership.
Adjusting the Fleet Structure to Efficiently Match Capacity
to Lower Demand
The Company's fleet management has always
stood out for its flexibility to adjust the size of the fleet, by
either accelerating aircraft deliveries or extending aircraft
contractual lease terms, in order to match it to the demand for air
travel. During the past 12 months, the Company renegotiated
with its aircraft lessor partners, in order to obtain reductions in
the values of current and future leases and convert a portion of
the monthly payments from fixed to variable (power-by-the-hour).
GOL's agreements are adjusted to the recovery in 2021 demand and
also represent effective savings in the Company's unit cost
structure. These contracts have lower values in the medium and long
terms and avoid increased costs with onerous deferral agreements,
maintaining GOL as the airline with the lowest aircraft operating
cost and indebtedness among its local peers, and with the lowest
dollar commitment per aircraft.
Since the start of this crisis and until the end of April/21,
the Company will have decreased its fleet by 17 Boeing 737 leased
aircraft and reduced its 2020-2022 Boeing 737 MAX deliveries by 34
aircraft. The Company ended March with a total fleet of
127 B737s, eight of which are B737-MAX models. With 63
aircraft operating in its network, daily flight operations
decreased 31% over February/21 and were equivalent to 48% of
the takeoffs and 52% of the ASKs in March/20.
During March, GOL adjusted frequencies to match lower demand in
its hubs in São Paulo, Rio de
Janeiro, Brasília, Fortaleza and Salvador. The Company is
currently operating 83% of routes in its domestic network, a 15
p.p. decrease from February/21, which represents higher levels
compared to the beginning of 2020.
As a result, the Company is well positioned for growth in both
major and regional markets when demand for air travel resumes.
Also, in March, GOL was the first Brazilian airline to receive
certification from Brazil's ANAC
for friction performance on the new pavement of the Congonhas
airport runway. As a result, the Company can either operate NG or
MAX aircraft with less restrictions on rainy days at this
airport.
In April/21, GOL is adapting its fleet and will operate 50
aircraft in its network to manage capacity and costs during this
period of lower demand. During the month, the Company is reducing
operations to between 185 and 200 flights/day, five times greater
when compared to the "essential network" of April/20. During
this current month, the Company will temporarily suspend
operations in Caldas Novas (CLV),
Campina Grande (CPV), Caxias do South (CXJ), Dourados (DOU),
Jericoacoara (JJD), Londrina (LDB), Montes Claros (MOC), Sinop
(OPS) and Uberlândia (UDI). GOL remains positioned to increase
its capacity and aircraft in the network quickly and efficiently to
match higher demand for air travel as the "second wave" of Covid-19
dissipates.
Executing Environmental, Social and Governance ("ESG") Best
Practices
The Company encourages the airline industry as a
whole to tackle climate change, social inequality and governance
issues by becoming more sustainable, inclusive and transparent. As
the Company manages through the Covid-19 pandemic, GOL has sought
to maintain its commitment to the highest standards of ESG. The
Company is a world leader in striving to make the aviation industry
more sustainable in areas related to carbon neutralization and the
development of biodiesel fuel alternatives. In March, the Company
completed 10 years of Gold Standard in the Brazilian GHG Protocol
Program, for its voluntary efforts to measure, understand, seek
solutions and provide transparency on the impact of its operations
to the environmental.
GOL has always been a pioneer in helping make commercial
aviation even more sustainable. The Company proactively reports
relevant ESG information to investors in accordance with the
Sustainability Accounting Standards Board ("SASB") standard for the
airline industry. In this challenging operating environment
globally for airlines, this industry's commitment to ESG
initiatives is critical.
GOL provides important metrics for monitoring its ESG
performance. In March, the Company's Gross Global Scope 1 Emissions
(metric thousand tons CO2) were 109.5, a 25.6% reduction
compared to February/21, as Total Fuel Consumed (liters, 1,000/RPK)
reached 37.4 and Greenhouse Gas Emissions/flight hour (tons
CO2) was 7.3, a 0.6% decrease compared to
February/21.
Aligned to Safety, GOL is Prepared for a Slower
Recovery
Kakinoff concluded: "We are facing a severe phase
of Covid-19 in Brazil, and both
airlines and tourism are among the most highly affected industries.
Despite all the challenges that we are facing, we now have the
certainty of the vaccine, a different scenario from what we saw
last year. As a member of the "Unidos pela Vacina" (United
for the Vaccine) group, we have dedicated ourselves to initiatives
that accelerate the mass immunization process by the Brazil's National Immunization
Program and ensure that we can get through to the other side
of this crisis. Our priorities remain the Safety of our Customers
and Employees, preserving jobs and providing an efficient air
network for the necessary transport and distribution of
vaccines."
The Company prioritizes its Customers and Crew to have a safe
and enjoyable experience while on board. In addition to adhering to
the already strict standards of civil aviation sanitation
established by authorities, in line with the recommendations of the
International Civil Aviation Organization (ICAO), World Health
Organization (WHO), International Air Transport Association
(IATA), Agência Nacional de Aviação Civil (ANAC - National
Civil Aviation Agency) e Agência Nacional de Vigilância Sanitária
(Anvisa), GOL seeks to enhance its operations on every front,
including ticket sales, customer service, boarding, the in-flight
experience and disembarkation services. The Company is the only
airline in Brazil with a
partnership with the Albert Einstein Hospital, which certifies all
of its Covid-19 prevention procedures and measures.
In March/21, the ANAC (National Civil Aviation Agency) released
the 2020 Monitoring Bulletin of Consumidor.gov.br - Air Transport,
with the main data on passengers' interactions with airlines during
2020. Among the airlines that most carry passengers, GOL registered
the highest satisfaction and problem-solving indexes, and with the
shortest average response time.
"The investments made over the years in technological
innovations, aimed to simplify the process for traveling with GOL,
our strategic partnerships, and our Team of Eagles are the pillars
of the Company's future in the aviation industry. We believe that
people will want to fly with the airline they trust most in Service
and Safety, both during and after the pandemic," said Eduardo Bernardes, Vice president of Sales and
Marketing.
Key Metrics – March 2021
(preliminary and unaudited)
Liquidity
|
March/2021
|
∆
February/2021
|
Total
liquidity
Deposits
Unencumbered
assets
|
R$1.9
billion
R$2.2
billion
R$1.3
billion
|
-10%
-
-
|
Net Cash
Consumption
|
March/2021
|
∆
February/2021
|
Cash
inflows
Cash
outflows¹
Net cash consumption
("burn")
|
R$25
MM/day
R$(25)
MM/day
-
|
+13%
-
-
|
Fleet
|
March/2021
|
∆
February/2021
|
Total
(average)
Operating aircraft
(average)
Flights per day
(average)
Network destinations
– Total²
|
127
63
245 (48% of
2020)
62 (83% of
2020)
|
-1
-15
-31%
-2%
|
Operating
Results
|
March/2021
|
∆
February/2021
|
Seats – Domestic
& Total (000)
ASK – Domestic &
Total (million)
Load factor –
Domestic & Total
Consolidated gross
revenue (R$MM)
|
1,331
1,609
71.8%
300
|
-23%
-23%
-9.0 p.p.
-37%
|
Metrics
|
March/2021
|
∆
February/2021
|
Gross Global Scope 1
Emissions (000 m t CO2)
Total Fuel Consumed
(1,000 liters per RPK)
Greenhouse gas
emissions/flight hour (t CO2)
|
109.5
37.4
7.3
|
-25.6%
+8.8%
-0.6%
|
1- Excluding financial debt
service;
2- Excludes codeshare and interline
destinations.
1Q21
Commentary
|
- GOL expects a Loss
Per Share (EPS) and a Loss Per American Depositary Share (EPADS)
for 1Q21 of approximately R$2.351 and
US$0.831, respectively.
- EBITDA2
margin for the first quarter excluding non-operating and
non-recurring expenses is expected to be 20% to 22%, a decrease in
relation to the quarter ended in March 2020
(46%2).
- Passenger unit
revenue (PRASK) for the 1Q21 is expected to be approximately 12%
lower year-over-year. GOL expects unit revenue (RASK) to be 9%
lower when compared to 1Q20.
- Non-fuel unit costs
(CASK ex-fuel) for 1Q21 excluding non-operating and non-recurring
expenses are expected to increase approximately 21%2
compared to 1Q20 reported CASK ex-fuel, primarily due to a
44% reduction in ASKs and the 23% depreciation of the
Brazilian Real versus the US dollar. Fuel unit costs (CASK fuel)
are expected to reduce by approximately 8% year-over-year, mainly
due to the fuel efficiency consumption of the MAX aircraft,
partially offset by a 2% increase in the average fuel price and by
the BRL depreciation versus USD.
- GOL's financial
leverage, as measured by the Net Debt3/LTM EBITDA ratio,
was approximately 11x at the end of the March 2021 quarter. The
Company amortized approximately R$418 million of total debt in the
quarter, and total liquidity was R$1.9 billion, comprised of R$1.2
billion in cash and investments and R$0.7 billion in receivables.
Including the financeable amounts of deposits and unencumbered
assets, GOL's liquidity sources total over R$5 billion.
- In the 1Q21, Gross
Global Scope 1 emissions (in thousand metric tons of
CO2) were approximately 488.4, a 12% reduction versus
4Q20, while Total Fuel Consumed (in thousand liters per RPK) was
34.4, 5% higher compared to 4Q20, and Greenhouse Gas Emissions per
Flight Hour (in tons of CO2) were around 7.3,
representing a 22% reduction versus the 4Q20.
|
Preliminary and
Unaudited Projections 1Q21
|
Domestic Routes
Served (average) / % of 2019
Average Operating
Fleet / % of 2019
Net Operating
Revenues (R$ BN) / % of 2019
EBITDA
Margin2
EBIT
Margin2
CAPEX (R$
MM)
Net Cash Burn
(R$MM/day)
Other Revenue (cargo,
loyalty, other)
Average fuel price
per liter
Average exchange
rate
Gross Global Scope 1
emissions (000 m t CO2)
Total Fuel Consumed
(1,000 liters per RPK)
Greenhouse Gas
Emissions/Flight Hour (t CO2)
Passenger unit
revenue (PRASK)
Operating CASK
Ex-fuel2
Domestic Demand –
RPK
Domestic Capacity –
ASK
Domestic Capacity –
Seats
Total Demand –
RPK
Total Capacity –
ASK
Total Capacity –
Seats
|
1Q21
~159 /
94%
~77 /
68%
~1.6 /
50%
20% - 22%
13% - 15%
~80
~3
10% of
revenues
R$2.84
- R$2.90
R$5.48
~488.4
~34.4
~7.3
1Q21 vs.
1Q20
Down ~12%
Up ~ 21%
Down ~36%
Down ~35%
Down
~43%
Down
~44%
Down
~44%
Down
~47%
|
1. Excluding gains and losses on currency and
Exchangeable Senior Notes.
2. Excluding
non-operating expenses and depreciation related to fleet idleness
and personnel-related costs of approximately R$700 million in 1Q21 and non-recurring expenses
of approximately R$87 million in
1Q20.
3. Excluding Perpetual Notes and
Exchangeable Senior Notes.
Investor Relations
ri@voegol.com.br
www.voegol.com.br/ir
+55(11) 2128-4700
Media Relations
Becky
Nye, Montieth & Company
bnye@montiethco.com
About GOL Linhas Aéreas Inteligentes S.A.
GOL serves more than 36 million passengers annually.
With Brazil's largest network,
GOL offers customers more than 750 daily flights to
over 100 destinations in Brazil
and in South America, the
Caribbean and the United States. GOLLOG's cargo
transportation and logistics business serves more than 3,400
Brazilian municipalities and more than 200 international
destinations in 95 countries. SMILES allows over 16
million registered clients to accumulate miles and redeem tickets
to more than 700 destinations worldwide on the GOL partner network.
Headquartered in São Paulo, GOL has a team of approximately 14,000
highly skilled aviation professionals and operates a fleet of 127
Boeing 737 aircraft, delivering Brazil's top on-time performance and an
industry leading 20-year safety record. GOL has invested billions
of Reais in facilities, products and services and technology to
enhance the customer experience in the air and on the ground. GOL's
shares are traded on the NYSE (GOL) and the B3 (GOLL4). For further
information, visit www.voegol.com.br/ir.
Disclaimer
The information contained in this press
release has not been subject to any independent audit or review and
contains "forward-looking" statements, estimates and projections
that relate to future events, which are, by their nature, subject
to significant risks and uncertainties. All statements other than
statements of historical fact contained in this press release
including, without limitation, those regarding GOL's future
financial position and results of operations, strategy, plans,
objectives, goals and targets, future developments in the markets
in which GOL operates or is seeking to operate, and any statements
preceded by, followed by or that include the words "believe",
"expect", "aim", "intend", "will", "may", "project", "estimate",
"anticipate", "predict", "seek", "should" or similar words or
expressions, are forward-looking statements. The future events
referred to in these forward-looking statements involve known and
unknown risks, uncertainties, contingencies and other factors, many
of which are beyond GOL's control, that may cause actual results,
performance or events to differ materially from those expressed or
implied in these statements. These forward-looking statements are
based on numerous assumptions regarding GOL's present and future
business strategies and the environment in which GOL will operate
in the future and are not a guarantee of future performance. Such
forward-looking statements speak only as at the date on which they
are made. None of GOL or any of its affiliates, officers,
directors, employees and agents undertakes any duty or obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except to
the extent required by law. None of GOL or any of its affiliates,
officers, directors, employees, professional advisors and agents
make any representation, warranty or prediction that the results
anticipated by such forward-looking statements will be achieved,
and such forward-looking statements represent, in each case, only
one of many possible scenarios and should not be viewed as the most
likely or standard scenario. Although GOL believes that the
estimates and projections in these forward-looking statements are
reasonable, they may prove materially incorrect and actual results
may materially differ. As a result, you should not rely on these
forward-looking statements.
Non-GAAP Measures
To be consistent with industry
practice, GOL discloses so-called non-GAAP financial measures which
are not recognized under IFRS or U.S. GAAP, including "Net Debt",
"Adjusted Net Debt", "total liquidity" and "EBITDA". The Company's
management believes that disclosure of non-GAAP measures provides
useful information to investors, financial analysts and the public
in their review of its operating performance and their comparison
of its operating performance to the operating performance of other
companies in the same industry and other industries. However, these
non-GAAP items do not have standardized meanings and may not be
directly comparable to similarly-titled items adopted by other
companies. Potential investors should not rely on information not
recognized under IFRS as a substitute for the GAAP measures of
earnings or liquidity in making an investment decision.
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SOURCE GOL Linhas Aéreas Inteligentes S.A.