Controladora Vuela Compania De Aviacion Sab De Cv Class A · BMV:VOLAR/A
Controladora Vuela Compania De Aviacion Sab De Cv Class A — Volaris — Investor Presentation (April 2015)
25 slides from Controladora Vuela Compania De Aviacion Sab De Cv Class A's investor presentation, April 2015
Slide 1: The Leading Ultra-Low-Cost Airline Serving Mexico and the US
The Leading Ultra-Low-Cost Airline Serving Mexico and the US April 2015
Slide 2: Disclaimer
Disclaimer The information ("Confidential Information") contained in this presentation is confidential and is provided by Controladora Vuela Compañía de Aviación, S.A.B. de C.V., (d/b/a Volaris, the "Company") confidentially to you solely for your reference and may not be retransmitted or distribute
Slide 3: Solid fourth quarter 2014 financial results and first quarter 2015 traffic results
Solid fourth quarter 2014 financial results and first quarter 2015 traffic results confirm reversal of trend Disciplined capacity management: International ASMs grew 31% in 1Q15, while Domestic ASMs grew 4% for same period as a continuous domestic capacity discipline. Total ASMs grew 11% during the
Slide 4: Volaris – Mexico’s Ultra-Low-Cost Carrier’s snapshot at 30,000 feet
Volaris – Mexico’s Ultra-Low-Cost Carrier’s snapshot at 30,000 feet Serving to 58 destinations throughout Mexico and the US Volaris’ destinations 2008 2014 CAGR New York Portland Unit cost Chicago (Midway/O’Hare) Sacramento (CASM ex-fuel; 5.5 5.4 -0.4% Oakland Denver cents, USD)(1) San Jose Reno Fre
Slide 5: Volaris’ low base fares stimulate demand and drive continuing growth
Volaris’ low base fares stimulate demand and drive continuing growth Since its launch, Volaris has stimulated new demand in the Mexican market through an aggressive revenue management strategy that drives lower fares and higher load factors Lower base Stimulation fares of demand Resilient ULCC busin
Slide 6: Volaris’ ULCC business model is clearly differentiated from legacies, hybrids and other LCC’s
Volaris’ ULCC business model is clearly differentiated from legacies, hybrids and other LCC’s Aeromexico Interjet VivaAerobus Volaris CASM FY 2014 (cents, USD)(1) 13.8 13.1 9.7(2) 8.8 Low ticket prices FY 2014 ≈ Average Fare (USD)(1) 167 103 45(2) 87 Non-ticket rev. exc. Cargo FY 2014
Slide 7: Volaris has a best-in-class unit cost structure
Volaris has a best-in-class unit cost structure Lowest unit cost in the Americas(1) CASM and CASM ex-fuel (FY 2014, USD cents)(3) 17.4 14.8 14.9 5.5 13.8 13.2 13.2 12.5 4.5 5.2 4.6 11.0 10.5 5.3 4.7 9.7 4.0 9.6 8.8 4.0 4.3 4.2 3.8 3.4 11.9 10.4 9.6 9.2 7.9 8.5 8.5 6.6 6.6 5.4 5.5 5.9 (4) (4) Avianca
Slide 8: Focus on fleet utilization and efficiency: A320 retrofit and A321 arrival
Focus on fleet utilization and efficiency drives higher revenue and lower cost: A320 retrofit and A321 arrival(1) High density configuration(5) Load factor Implied passengers Volaris A320 (FY 2014) per aircraft(2) 179 seats per aircraft Aeromexico 737-800 82% 147 160 seats per aircraft Interjet A320
Slide 9: Bus passenger shift to air travel
Bus passenger shift to air travel Significant upside for air travel Air travel time and cost savings Total bus trips Total air travel trips Mexico City – Tijuana (mm) (mm) Travel time (Hrs) Fare (USD)(2,3) 2,781 40.5 145 36.5 hours less 24% cost savings 2,706 110 60 4.0 30 75 30 (1) Bus Air Bus (1)
Slide 10: Unbundled strategy: “Tú decides” – You decide
Unbundled strategy: “Tú decides” – You decide Flight At the Onboard Pre-flight(1) Post-flight planning airport aircraft • V-Club subscription • Seat • Excess • Advertising • Hotel (113k active) assignment baggage rooms suscriptions) • Food and • Change / • Checked beverage • Car rentals • Co-branded
Slide 11: Acceleration of Volaris’ non-ticket revenues
Acceleration of Volaris’ non-ticket revenues Increased contribution of non-ticket revenue to the top line 2009 – 2014 CAGR: +53.2% Non-ticket revenue 206 (USD mm)(1) 148 115 68 24 39 2009 2010 2011 2012 2013 2014 Contribution to Operating 7% 7% 9% 13% 14% 19% Revenue Non-ticket revenue per passenger
Slide 12: Attractive growth opportunities in Mexico and throughout the Americas
Attractive growth opportunities in Mexico and throughout the Americas Domestic – growth potential of nearly 122 International – growth potential of about 139 routes (4) routes (4) Number of routes(1) Number of routes(2) 50 48 48 100 99 41 40 40 38 75 30 48 50 20 32 13 25 10 0 0 (3) USA (Leisure) USA
Slide 13: Substantial growth opportunity in the US-Mexico VFR / leisure travel market
Substantial growth opportunity in the US-Mexico VFR / leisure travel market Portland 0.2mm San Francisco Bakersfield Chicago 0.4mm Denver 1.5mm 0.7mm New York Sacramento 0.5mm 0.3mm 0.5mm Fresno Philadelphia 0.5mm Las Vegas 0.1mm Washington San Jose 0.4mm Dallas 0.1mm 0.4mm Albuquerque 1.5mm Atlanta
Slide 14: Positive expansion, managing capacity and diversification of routes
Positive expansion, managing capacity and diversification of routes Volaris offers more domestic routes than any other Mexican carrier Volaris flown domestic routes Volaris flown international routes More than 2x More than 2x 93 36 78 23 26 50 17 39 Dec' 11 Dec' 12 Dec' 13 Dec' 14 Dec' 11 Dec' 12 De
Slide 15: Fleet and financials
Secret / gill Mr deed Fleet and financials 15
Slide 16: A higher density fleet generates more incremental capacity with fewer additional aircraft
A higher density fleet generates more incremental capacity with fewer additional aircraft Projected fleet under current contracts (number of aircraft)(1) 59 55 3 50 2 2 44 14 9 23 24 23 22 19 20 18 17 12 FY13 FY14 FY15 FY16 A319 A320 A320 w/Sharklets A320 NEO w/Sharklets A321 w/Sharklets Seat growth
Slide 17: Solid financial performance
Solid financial performance Operating revenues(1) Adj. EBITDAR(1) 1,200 250 232 1,018 1,056 220 1,000 887 200 188 800 714 (USD mm) (USD mm) 150 140 536 116 600 100 374 100 400 50 200 0 0 2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014 Operating Revenues CAGR 2009 - 2014 Full year 2014 Ad
Slide 18: Solid balance sheet and liquidity, well funded for growth
Solid balance sheet and liquidity, well funded for growth LTM Liquidity – Cash and Equivalents / Op. Revenue • IPO provided sufficient liquidity / capital 28.1% for growth over the next years • Fully financed pre-delivery payments and 22.2% executed sale-leasebacks for all deliveries in 2015 and 201
Slide 19: Active in jet fuel hedging, reaching up to 45% of projected consumption
Active in jet fuel hedging, reaching up to 45% of projected consumption for 2015 and 2016 Period Total % hedged Avg. price (gal/USD$) Instrument 1Q15 29% $2.53 Swap/Call 2Q15 45% $2.15 Swap/Call 3Q-4Q15 45% $2.07 Call 1Q16 45% $1.95 Call 2Q16 40% $1.95 Call 3Q-4Q16 35% $1.99 Call 19
Slide 20: Appendix
Appendix 20
Slide 21: Non-IFRS Terms Glossary
Non-IFRS Terms Glossary • Available seat miles (ASMs): Number of seats available for passengers multiplied by the number of miles the seats are flown. • Block hours: Number of hours during which the aircraft is in revenue service, measured from the time it leaves the gate until the time it arrives t
Slide 22: Consolidated statements of operations summary
Consolidated statements of operations summary % of total operating MXN millions unless otherwise stated (2) 2012A 2013A 2014A 2014A (1) 4Q 2014A 4Q 2014A (1) revenues (USD (USD millions) millions) Passenger 10,177 11,117 11,303 768 3,140 213 79.3 Non-ticket 1,510 1,885 2,733 186 818 56 20.7 Total op
Slide 23: Consolidated statements of financial position summary
Consolidated statements of financial position summary MXN millions unless otherwise stated (5) 2012A 2013A 2014A 2014A (1) (USD millions) Cash and cash equivalents 822 2,451 2,265 154 Current guarantee deposits 238 499 545 37 Other current assets 755 1,050 879 60 Total current assets 1,815 4,000 3,6
Slide 24: Consolidated statements of cash flows summary
Consolidated statements of cash flows summary MXN millions unless otherwise stated (2) 2012A 2013A 2014A 2014A (1) 4Q 2014A 4Q 2014A (1) (USD millions) (USD millions) Cash flow from operating activities Income before income tax 207 283 644 44 760 52 Depreciation and amortization 211 302 343 23 138 9
Slide 25: Adj. EBITDA and Adj. EBITDAR reconciliation
Adj. EBITDA and Adj. EBITDAR reconciliation MXN millions unless otherwise stated (2) 2012A 2013A 2014A 2014A (1) 4Q 2014A 4Q 2014A (1) (USD (USD millions) millions) Net income 203 265 605 41 703 48 Plus (minus): Finance costs 90 126 32 2 9 1 Finance income (14) (25) (23) (2) (6) - (Benefit)/provisio