Copa Holdings, S.A. (NYSE:CPA) Q2 2023 Earnings Call Transcript

Helane Becker: Okay, that’s very helpful. And then, I just have one clarification, Jose, on the fleet plan. I think you said you were going to end this year with 107 aircraft or is it…?

Jose Montero: Yes.

Helane Becker: Right, okay. And then, next year based on the delivery schedule of 14, that means, well, 121 aircraft for next year?

Jose Montero: Yes, Helane, we still have a set of aircraft that are under lease that are – some of them could be extended, so our plan right now is that there will be a lease airplane that will be returning, so our expectation as of today is that we could end the year 2024 with 120 airplanes in total. So it will be 14 deliveries minus one lease return.

Helane Becker: Got it. And – could there be any other lease returns?

Jose Montero: No, at this time, I think it could be just this one.

Helane Becker: Okay. All right. That’s very helpful.

Pedro Heilbron: And we could renew – we could renew it also.

Jose Montero: Yes, yes, that’s what I’m saying, our view as of today is that, but it could – we’re still – we’re still relatively flexible in that.

Helane Becker: Okay. All right. Well, that’s really helpful. Thank you.

Pedro Heilbron: Thanks.

Operator: Our next question comes from Daniel McKenzie from Seaport Global.

Daniel McKenzie: Hi, good morning. Thanks, guys. Couple of questions on 2024, following up on Wingo, I know you’re not planning to grow it much, but how many aircraft are you planning for the entity next year? It looks like it’s about 16% of the seats today and my thought is that Wingo as a percent of the overall system could trend down as you grow the mainline.

Pedro Heilbron: Well, they are operating nine aircraft. Right now, at the end of the year will be nine out of 107. And it’s not that that number could not grow next year, it could, we have flexibility as Jose mentioned, but they could also stay at nine, it really depends on how the Colombian market develops and what are the opportunities there. But most of the growth will continue being from Copa Airlines. So, yes, their share of the total will come down under that premise, which is what will most likely happen.

Daniel McKenzie: Second question here, for those of us that don’t know all the smaller markets in Latin America, I’m wondering you just elaborate a little bit on the growth next year. So just some high-level thoughts on mix, growth in existing markets versus new markets, long-haul versus short-haul, whatever you can share would be great.

Pedro Heilbron: Yes, so it’s going to be a combination, well, it’s going to be mostly new frequencies, additional frequencies to currently served markets, and we should also keep in mind that in the last two years, we’ve started like eight or nine new routes in the region and some of those will get more capacity again plus the market we’ve been operating from before, so a lot is going to be – most of it is going to be new frequencies plus the full year effect of what we started this year will also impact capacity growth next year. And we still believe we’ll probably open a few, two – between two and four new destinations and there’s still a lot of opportunity in the whole continent in the Americas and we’re always evaluating new markets.

We also have nine cities from pre-pandemic where we have not restarted service, so we also have that. So we will be restarting service to some of the cities that we still haven’t gone back to from pre-pandemic. So we have that, we have new destinations, and mostly additional frequencies to currently served markets, so lots of opportunities as we see it.

Daniel McKenzie: Yes, good, terrific. Thanks, Pedro.

Pedro Heilbron: Thanks.

Operator: And our final question comes from Duane Pfennigwerth from Evercore ISI.