Wizz Air Holdings Plc · LSE:WIZZ
Wizz Air — FY2019 Earnings Presentation
31 slides from Wizz Air's earnings presentation, 2019
Slide 1: 2019 Wizz Air Holdings Plc Results for the Financial Year
2019 WIZZ AIR HOLDINGS PLC RESULTS FOR THE FINANCIAL YEAR
Slide 2: FY19 Delivered 34 million pax, higher unit revenues and lower ex-fuel unit costs
FY19 │ DELIVERED 34 MILLION PAX, 2% HIGHER UNIT REVENUES AND 1% LOWER EX-FUEL UNITS COSTS TO HELP OFFSET HIGHER FUEL PRICES Passenger growth +17%, Revenue growth +20%, Load factor +1.5ppt Record net profit of €292m (€295m excluding closure of Wizz Tours) Superior cost performance underpinned by 250+
Slide 3: FY19 Another record year
FY19 | ANOTHER RECORD YEAR Passengers 34.6m Aircraft 112 Airports 146 Bases 25 Employees 4,500 125 Countries 44 Source: Audited company results as at 31 March 2019
Slide 4: FY19 Improving operational metrics
FY19 | IMPROVING OPERATIONAL METRICS 80 100% Flights 190,000 +13% 75 70 74 80% 60 Load factor 92.8% 50 54 60% +1.5ppt 40 40 38 40% 30 32 Utilisation 12 hours 20 24 -5.2% 21 20% 10 12 12 9 1 4 0 0% Regularity 99.8% A M J J A S O N D J F M A +0.3ppt Cancellations On-time performance Source: Audited co
Slide 5: Building market leading positions
FY19 | BUILDING MARKET LEADING POSITIONS #2-3 34% #1 62% Poland, Lithuania, Latvia, Slovakia Hungary, Romania, Bulgaria, Ukraine, Macedonia, Georgia, Serbia, Moldova, Bosnia #1 LCC in CEE #4 4% Austria and Wizz Air UK …… #1 London-Luton Source: Company Information. Innovata, Apr 2018 to Mar 2019. *
Slide 6: Financial Review
Financial Review
Slide 7: FY19 Financial review
FY19 | FINANCIAL REVIEW Group Results FY 2019 FY 2018 Change Seat growth +14.9 % Revenue (€) 2,319.1 m 1,939.0 +19.6% Load factor +1.5 ppt EBITDAR (€) 718.5 m 659.9 +8.9% EBITDAR margin (€) 31.0 % 34.0 % -3.1ppt Passenger growth +16.7 % Net profit (€) 291.6 m 275.1 +6.0% Net profit margin (€) 12.5 %
Slide 8: FY19 Strong revenue generation
FY19 | STRONG REVENUE GENERATION Revenue (€m) +20 % RASK Bridge (€cent) +2.3 % -0.01 2,319 +0.09 1,939 953 -0.03 807 -0.16 +0.18 3.85 3.78 1,366 1,132 FY18 Easter Bag Value-add Ticket IFRS15 FY19 Effect Revenues Revenues FY18 FY19 Ticket Ancillary Source: Audited company results as at 31 March 2019
Slide 9: FY19 Strong ancillary revenue recovery
FY19 | STRONG ANCILLARY REVENUE RECOVERY Ancillary Revenue* €/pax Quarterly Change Ancillary Revenue per pax (€) +0.3 27.2 27.6 4.2 1.5 1.5 0.8 19.1 -0.7 -1.5 22.2 -2.4 -2.9 8.1 5.3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY18 FY19 F18 F19 Baggage Value-Add * Rounding Source: Audited company results as at 31 March
Slide 10: FY19 Disciplined ultra-low costs
FY19 | DISCIPLINED ULTRA-LOW COSTS CASK (€cent) CASK € cent FY19 FY18 Change +4.9% 3.35 3.19 1.11 0.93 0.18 Fuel 0.93 1.11 +19.0% Staff costs 0.33 0.29 0.04 Distribution & marketing 0.06 0.06 0.00 Maintenance, materials & 0.19 0.19 0.00 2.26 2.24 -0.9% repairs Aircraft rentals 0.54 0.54 0.00 Airport
Slide 11: FY19 Product innovation
FY19 | PRODUCT INNOVATION Wizz Bundles Wizz Allocated Seating Wizz Priority Products
Slide 12: FY19 A321neo – a true game changer
FY19 | A321NEO – A TRUE GAME CHANGER 16% less fuel burn 16% less CO2 emissions 43% lower noise footprint 16% flying further 20% lower unit costs vs A320ceo
Slide 13: Large order book of A321/A320neo aircraft to drive costs even lower
FY19 | LARGE ORDER BOOK OF A321 / A320NEO AIRCRAFT TO DRIVE COSTS EVEN LOWER 276 257 226 211 184 186 161 165 130 140 113 122 97 112 68 35 93 2 12 79 67 38 41 41 41 41 41 37 25 15 16 26 4 5 18 33 42 58 72 63 63 67 72 64 69 51 30 24 17 13 5 FY 15/16 FY 16/17 FY 17/18 FY 18/19 FY 19/20 FY 20/21E FY 21/
Slide 14: Balance sheet strength to underpin even lower unit costs
FY19 | BALANCE SHEET STRENGTH TO UNDERPIN EVEN LOWER UNIT COSTS 6 64 Balance Sheet Strength: 407 Strong cash generation in FY19 Historically low interest rates 1,316 SLB of all CEO assets 980 Self-financing aircraft deposits 246 Airbus neo aircraft to finance Cash Flow Opening from Financing Investi
Slide 15: Record cash generation
FY19 | RECORD CASH GENERATION € million +32% 1,505 189 1,142 Strong cash generation 162 Leverage Investment grade balance sheet 1,316 1.7x 980 Maintaining or lowering leverage Multiple aircraft financing options F18 Free Cash F19 Restricted Cash Leverage Current methodology derives debt of €2.3bn 1.
Slide 16: FY20 Guidance
FY20 | GUIDANCE Guidance Capacity growth (ASKs) +16% (H1: 17%, H2 15%) Average stage length Modest increase Load Factor + 1 ppt Fuel CASK +7% Ex-fuel CASK * -2% Ex-fuel CASK * (including net interest expense) Broadly flat Total CASK +2 % Revenue per ASK Up low single digit Effective tax rate 4% Net
Slide 17: FY20 Impact of IFRS 16 – lease accounting
FY20 | IMPACT OF IFRS 16 – LEASE ACCOUNTING Opening Balance Sheet Adjustments Estimated P&L Changes in FY20 € million € million DR CR DR DR CR 116 DR 280 82 DR DR 26 (1,815) (400) 1,418 278 14 Property, Plant Retained Financial Rental cost Net Deferred Lease Depreciation Other & Equipment Earnings E
Slide 18: Significant Growth Opportunity in CEE
Significant Growth Opportunity in CEE
Slide 19: Leading ULCC in CEE
LEADING ULCC IN CEE Attractive Growth Growing Propensity to Travel 2.0 2.5% 1.5% 0.5 GDP Growth – 2020 est. Propensity to travel Underpenetrated Markets Failing and Weak Airlines 683 Monarch Germania #1 LCC Flybmi Sky Works Primera Cobalt Cello 108 Wow Air Small Planet Azur in CEE FY19 Seats in m
Slide 20: Network growth FY19
NETWORK GROWTH FY19 Increasing Frequencies Joining existing airports + 56% +28% New Destination Countries New Airports +14% +2% Austria, Estonia 6 airports
Slide 21: CEE hometown airline
_ CEE HOMETOWN AIRLINE S je i « ~ { d q a 8 WARSAW CHOPIN 7 3x Bx é WROCLAW A Ss 2 KATOWICE —~ LONDON-LUTON [i | 2 VILNIUS 4 KYIV ZHULYANY 1X 2% 4x IASI 2 3 TIMISOARA CHISINAU : 2x u a 5 VIENNA " _ 7 CLUJ-NAPOCA FF 1X 4x _ Ba <a 1 / bE —— TT . y . LA Ba) DeBrecen aa — Rar ~ ne BL | SS BUDAPEST t = 4
Slide 22: New aircraft deployed so far in FY20
NEW AIRCRAFT DEPLOYED SO FAR IN FY20 8 NEW AIRCRAFT
Slide 23: New airline: Wizz UK
NEW AIRLINE: WIZZ UK 3 MAY 2018 – FIRST WIZZ AIR UK FLIGHT FROM LONDON LUTON TO BUCHAREST Current Fleet 11 41 Routes UK Team 450+
Slide 24: Improving operational performance and customer experience
IMPROVING OPERATIONAL PERFORMANCE AND CUSTOMER EXPERIENCE Industry Challenges Actions Taken Disruptions Scheduling - ATC - Optimise block times - Ground transportation - Mid-day schedule breaks - Ground / Baggage handlers - Night flights Infrastructure Constraints Improved Boarding Times - Navigatio
Slide 25: Truly digital business
TRULY DIGITAL BUSINESS [<|. t wizzair.com TOP 10 NRE ORLD's I MOST VISITED 1 EUROPEAN LCC ON FACEBOOK HIGHEST ENGAGEMENT RATE erent “On INSTAGRAM : LANGUAGES LANGUAGES ACCELERATED GROWTH: : FOLLOWERS DOUBLED Y-O-Y —: 1.6 2.2 BILLION BILLION Se icttemonns inthe sta nomhe VIZZ4 wizzair.com
Slide 26: Investing in our people
INVESTING IN OUR PEOPLE Inauguration of state-of-the-art €30m training centre in Budapest Awarded highest 7-star safety ranking by AirlineRatings.com Wizz People Council created Wizz Foundation created CEESAR Award “Best Cabin Crew in CEE”
Slide 27: Wizz 300
WIZZ 300 €6-7 BN revenues 100M pax/year 2000 new hires/year 10.000 employees
Slide 28: Closing comments
CLOSING COMMENTS Another record year in FY19 and solid start to FY20 Market characteristics and economic prospects across CEE continue to favour Wizz Air’s ULCC business model, significant growth opportunity Delivery of Airbus A321neo game-changing aircraft commenced. Order book of 253 aircraft to 2
Slide 29: Wizz Disclaimer
WIZZ | DISCLAIMER This presentation has been prepared by Wizz Air Holdings Plc (the “Company”). By receiving this presentation and/or attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations. This presentation is
Slide 30: Appendix: ULCC model
APPENDIX | ULCC MODEL ® YOUNG & UNIFORM Fleet J HIGH SEAT DENSITY AND Load factor SECONDARY Airports XS OUTSOURCED BUSINESS Model LOW-COST HIGH REVENUE DISTRIBUTION FROM via wizzair.com Ancillary Products HIGH HIGH Aircraft Employee utilization Productivity b LOWEST COSTS WZ wizzair.com
Slide 31: Appendix: Hedge program
APPENDIX: HEDGE PROGRAM EUR/USD EUR/GBP Jet Fuel HEDGE COVERAGE 54% 54% 21% 22% 10% FY20 FY21 FY20 FY20 FY21 11 months 7 months 11 months 7 months Capped rate $1.24 $1.24 £0.92 £0.92 $705 $689 Floor rate $1.19 $1.19 £0.88 £0.88 $643 $631 Sensitivities (before hedges) for the remaining F20 period: •