Equity Analysis /
Mexico

Volaris: Flash: Holy week boosted April passengers

  • In April total passengers increased by 34.6% y/y (+39.1% vs same month of 2019) boosted by Holy Week

  • We believe that strong demand will support a favorable fares environment, helping to mitigate the expected rise in costs

  • We consider that the airline will continue to leverage their leadership in the sector

Jose Itzamna Espitia Hernandez
Jose Itzamna Espitia Hernandez

Senior Equity Research Analyst, Infrastructure, Materials and Transportation

Marissa Garza Ostos
Marissa Garza Ostos

Head of Equity Research

Banorte
9 May 2022
Published by

Volaris’ recorded an annual increase of 34.6% y/y in total passenger traffic during April, transporting a total of 2.6 million, that represented a 39.1% rose vs. April 2019. The annual growth in international passengers was 43.1%, followed by domestic passengers which recorded 33.1%. The capacity, measured in terms of Available Seats Miles (ASMs), rose by 28.1% y/y (+37.5% vs April 2019), while demand, measured in Revenue Passengers Miles (RPMs), registered a 31.6% y/y increased (+37.6% vs. same month of 2019). Thus, the load factor advanced 2.3pp to 84.6%.

Positive implication: Company’s figures showed a positive performance, supported by Holy week and lesser pandemic restrictions comparing to April 2021. Even though 1Q22 showed higher pressures in profitability due to increases in fuel prices, we believe that the strong demand will support a favorable fares environment, helping to mitigate the expected rise in costs. Therefore, we consider the airline will continue to leverage their leadership in the sector, while we will keep monitoring the volatility in oil prices.