Azul’s AZUL stock has declined 3.6% since its earnings release on Aug 12. The wider-than-expected loss posted by the company for second-quarter 2021 in the current scenario of improving air-travel demand seems to have disappointed investors.
Delving Deeper
The company’s second-quarter loss (excluding $3.41 from non-recurring items) of $1.91 per share was wider than the Zacks Consensus Estimate of a loss of $1.53. In the year-ago quarter, loss was $2.38 per share.
Total revenues of $321.4 million outperformed the Zacks Consensus Estimate of $302.1 million. The top line jumped more than 100% year over year as air-travel demand improves, courtesy of widespread vaccination programs in Brazil.
With more and more people taking to the skies, passenger revenues, accounting for 83.2% of the top line, escalated 401.7% from the second-quarter 2020 levels. Other revenues surged 139.3% year over year, primarily owing to the increase in cargo net revenues, driven by upbeat demand for Azul’s logistics solutions.
All comparisons given below are made on a year-over-year basis.
Consolidated traffic, measured in revenue passenger kilometers (RPKsurged 360.7% on the back of the 422.7% increase, domestically. The metric increased 43.3% on the international front.
Consolidated available seat kilometers (ASK), measuring an airline's passenger-carrying capacity, expanded 337.7% in response to the increased capacity on both counts. While domestic capacity soared 391%, international capacity expanded 85.8%. With traffic increase surpassing capacity expansion, consolidated load factor (percentage of seats filled with passengers) improved 380 basis points to 76.7%.
While total revenues per ASK or RASK decreased 3.2%, passenger revenues per ASK or PRASK increased 14.6%. Cost per ASK (CASK) declined 60.7%. Jet fuel prices skyrocketed 102.4% year over year with oil prices moving north. CASK excluding fuel decreased 70.5%. Average fare dipped 3.9% from the year-ago quarter’s figure.
Azul exited the second quarter with total passenger operating fleet of 161 aircraft. The average age of the fleet was 6.8 years. Contractual fleet size was 178.
The airline, currently carrying a Zacks Rank #3 (Hold), exited the June quarter with total liquidity of R$8.2 billion, up 45.5% year over year. Gross debt increased 6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Airline Stocks
Southwest Airlines (NYSE:LUV) LUV, incurred a loss (excluding 92 cents from non-recurring items) of 35 cents per share in the second quarter of 2021, wider than the Zacks Consensus Estimate of a loss of 21 cents. Operating revenues of $4,008 million outperformed the Zacks Consensus Estimate of $3,942.5 million.
Delta Air Lines (NYSE:DAL) DAL, incurred a loss (excluding $2.09 from non-recurring items) of $1.07 per share, narrower than the Zacks Consensus Estimate of a loss of $1.41. Total revenues of $7,126 million also topped the Zacks Consensus Estimate of $6,340.9 million.
American Airlines (NASDAQ:AAL) AAL, incurred a loss (excluding $1.72 from non-recurring items) of $1.69 per share, comparing favorably with the Zacks Consensus Estimate of a loss of $1.71. Operating revenues of $7,478 million also surpassed the Zacks Consensus Estimate of $7,425.6 million.
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Delta Air Lines, Inc. (DAL): Free Stock Analysis Report
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