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GOL Linhas' (GOL) July Traffic Rises, Load Factor Falls

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GOL Linhas Aereas Inteligentes S.A. reported unimpressive traffic figures for July 2018, with load factor (percentage of seats filled by passengers) declining due to capacity expansion that outpaced traffic growth.

Traffic, measured in revenue passenger kilometers (RPK), rose to 3.88 billion by 6.3%. While domestic RPK climbed 10%, international RPK plunged 21.8%. On a year-over-year basis, consolidated capacity (or available seat kilometers/ASKs) expanded 7% to 4.77 billion. Domestic ASK improved 9.6%, while international ASK slid 11.8%. The carrier witnessed 8.2% rise in passenger count. Load factor fell to 81.5% from 81.9% in the year-ago period.

At the end of the first seven months of 2018, RPK was up 4% and ASK grew 3.5%. Also, load factor for the period improved 40 basis points (bps). Volume of departures inched up 1.1% and the number of seats rose 2.5%.

Apart from rise in traffic, GOL Linhas was also in the news for second-quarter 2018 earnings report released on Aug 2. The company incurred a loss of 45 cents, thanks to the depreciation of Brazilian Real against the U.S. Dollar. Meanwhile, net revenues came in at $656 million (R$2.4 billion).

Both RPK and ASK rose 2.5% and 2.2%, respectively, year over year in the quarter. While the metrics expanded at the domestic level, the same contracted in the international front.

Zacks Rank & Key Picks

Gol Linhas carries a Zacks Rank #4 (Sell). A few better-ranked stocks in the broader Transportation Sector are Atlas Air Worldwide Holdings , ArcBest Corporation (ARCB - Free Report) and GATX Corporation (GATX - Free Report) . While GATX carries a Zacks Rank #2 (Buy), Atlas Air Worldwide and ArcBest sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Atlas Air Worldwide, ArcBest and GATX have returned more than 19%, 47% and 29%, respectively, in the past six months.

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