Low-cost carrier Volaris achieved net profitability for the first quarter of 2024 with a net income of $33 million, the first time the carrier has recorded a net profit in the first quarter since 2019, alongside posting an EBITDAR of $235 million (a 91% increase). Volaris’ EBITDAR margin was 30.6%, an increase of 14 percentage points.
“Looking forward, booking curves remain solid. As we execute our strategy, we prioritize profitability when allocating capacity and are cautiously optimistic about achieving results in line with our updated guidance,” highlighted Enrique Beltranena, president and chief executive officer of Volaris.
Total operating revenues for the quarter rose 5.1% to $768 million, with total operating expenses representing 86% of total operating revenue at $664 million. This was driven by ‘solid demand and an improvement in total revenue per passenger,’ which rose 35% to $57, with ancillary revenue representing 51% of total operating revenue.
However, total capacity for the quarter decreased 13% to $8.2bn ‘due to the accelerated Pratt & Whitney engine inspections and the resulting aircraft groundings’. Ongoing GTF issues also impacted the 11% rise in cost per available seat mile to $5.16, with ‘this increase … mainly caused by the aircraft-on-ground due to Pratt and Whitney’s engine preventive accelerated inspections and the effect of a larger proportion of international capacity with higher landing and navigation fees’. Volaris expects to receive as-yet-unspecified compensation from Pratt & Whiney following a ‘previously announced’ agreement last December.
For the second quarter of 2024, Volaris expects to maintain its predicted ASM growth by around 18% year-on-year, with an EBITDAR margin of 31%-33%. For the full year 2024, although ASM growth will be fractionally less at 16% to 18%, the EBITDAR margin will be slightly higher overall at 32% to 34%.
Volaris: net income of $33 million for Q1 2024 despite GTF groundings
