Jaime Esteban Pous Fernandez: Hi, Michael. This is Jaime. The average number of aircraft that we had grounded during the first quarter was 29, Michael. I think the peak we are going to experience the peak in the third Q and the beginning of the third Q for this year.
Michael Linenberg: How much will be in third Q?
Jaime Esteban Pous Fernandez: The peak is going to be on the 3Q and the 4Q. Michael, I think you better see these because there are engines coming up and coming down. Think about reduction in ASMs instead of aircraft on ground. We will be provided the average planes at the end of each quarter, but consider that guidance of reducing 16% to 18% capacity, the flight forward of engines that we expect to be AOG during the year.
Michael Linenberg: Okay. My second question is, when we look at the operating gain that other operating expense or credit that you took in the quarter, how many airplanes or engines are underlying that? This is more of a modeling question. How does that number — what does that number look as we move through the year? Is that the high it seems like that would be the high point and that number would come down dramatically based on your deliveries for the year. Is that right?
Jaime Esteban Pous Fernandez: Okay. I’m going to talk about two lines, Michael. First, on the other operating income line, remember what we are including in that line is single leaseback gains. This quarter reflects three the single leasebacks gains of three A321 neos and also flight compensation. When you move to variable lease expenses, which are basically re-deliveries, there is where we have a one-time effect that we for the re-deliveries extensions of the 2025 aircraft and one 2026 aircraft that is going to come back to the normal number of that. We had also that benefit in the 4Q. But going forward, since we are not expecting to make decisions on extending any more aircrafts, it should be stabilized to historically numbers, Michael.
Michael Linenberg: Okay. That’s helpful then. Thank you.
Jaime Esteban Pous Fernandez: Michael, if I may. I think it’s important to give some color to this whole thing in fact. I mean, the first thing is a quarter, which I think it’s a spectacular in terms of TRASM because Pratt doesn’t compensate those anything on revenues, okay. I think that’s really important to be considered. The performance there at the revenue line is real and very, very driven by the market capacity and the way we are managing our TRASM factors. The second point, which is really important is, despite we did really well on the revenue on the CASM things are going to get more and more complicated exactly because of what you’re asking. Towards the third quarter, we have the largest amount of engines in repair. It is important that I don’t want you guys to get bullish with the results of the first quarter, because we remain skeptical on what is coming in terms of engines during the next couple of quarters.
Operator: Our next question will be coming from Rogerio Araujo of Bank of America. Your line is open.
Rogerio Araujo: Yes. Hi, guys. Thanks very much for the opportunity. Congratulations on the strong results. A couple here on my side. First, is there any way we can think about the net impact of the engine recall? What I mean is, if we take into consideration the compensation this quarter, but also these economies of scale that Volaris is facing and the higher TRASM that the lower flight frequencies are giving you, is this positive or negative to EBITDA and margins in your view? Anything you can — any color you can give on that would be extremely helpful. The idea here is to think how recurring these stronger margins are for upcoming years. Thank you.
Jaime Esteban Pous Fernandez: Hi, Rogerio. This is Jaime. I will say that, you should think, that this quarter was really everything about TRASM. Pratt compensation doesn’t compensate for revenue loss. We’ve got 29 aircraft on ground and we were able to fully compensate the revenue loss of those aircraft by our own and our work and network and not the strategies that Enrique and Holger has been talking about since the last quarter. What the only thing that is helping is TRASM, because basically I’m getting compensated for the rents of the fleet that are grounded. But I’m not getting fully compensated for all of the direct cost from the grounded fleet. I think in general, the plant situation is negative for the entire business and basically, we are having a plant in order to mitigate the consequences of it.
Unidentified Company Representative: I think if I want to add some color to that, I think the TRASM improvement will continue as much as everybody continues being careful with the capacity that they inject into the market, especially once the capacity is starting to come back. We, in Volaris, are absolutely careful and very, very detailed in the way we will re-assume the capacity into the market and we don’t want to create a problem, A, on capacity or B, on pricing.
Rogerio Araujo: This is very clear and helpful. Thank you. Another very quick question here is on this extension of aircraft lease contracts. This has been supporting the variable lease expenses line in the past couple of quarters. Should we expect further positive impacts in coming quarters or that was it? Thank you.
Jaime Esteban Pous Fernandez: You should not expect that, Rogerio.
Rogerio Araujo: Okay, perfect. Thank you very much.
Operator: One moment for our next question. Our next question will be coming from Helane Becker of TD Cowen. Your line is open. Again, Helane Becker of TD Cowen. Your line is open.
Operator: Our next question will be coming from Guilherme Mendes of JPMorgan. Your line is open.
Guilherme Mendes: Good morning. Good afternoon everyone. Holger, Jaime, Ricardo, thanks for taking my question. I have a follow-up question on the competitive…
Unidentified Company Representative: Can you speak up? We barely hear you.
Guilherme Mendes: Fair now. Hello?
Unidentified Company Representative: Yes, go ahead.
Guilherme Mendes: Okay. Sorry, can you hear me better now?
Unidentified Company Representative: Yes.
Guilherme Mendes: Sorry about that. My question is on the Holger’s point about competitors adding capacity in a conservative way. How overall have you been seeing the competitive environment in Mexico? Assuming that Viva will start to ground more capacity more towards the second half of the year. Do you see some kind of pressure at some point in time or the best case is for all the competitors to continue to be rational? Thank you.
