Copa Holdings, S.A. (CPA Quick QuoteCPA - Free Report) ) reported solid first-quarter 2023 results wherein earnings and revenues surpassed the Zacks Consensus Estimate.

Quarterly earnings of $3.99 per share surpassed the Zacks Consensus Estimate of $3.34 and rose more than 100% year over year. Revenues of $867.3 million beat the Zacks Consensus Estimate of $839.1 million and improved year over year on the back of passenger revenues.

Passenger revenues (contributed 96.1% to the top line) increased 28.5% from first-quarter 2019, owing to higher yields (up 20%). Cargo and mail revenues jumped 51.8% to $23.25 million, owing to higher cargo volumes and yields. Other operating revenues improved 24% to $9.99 million, owing to revenues from non-air ConnectMiles partners.

Below, we present all comparisons (in % terms) with first-quarter 2019 levels (pre-coronavirus).

On a consolidated basis, traffic (measured in revenue passenger miles) grew 7.1%, and capacity (measured in available seat miles [ASMs]) increased 2.8%. As a result, the load factor increased 3.5 percentage points to 86.8% in the reported quarter.

Passenger revenue per ASMs increased 25% to 12.6 cents. Additionally, revenue per ASM increased 25.5% to 13.1 cents. Cost per ASM increased 17.2%. Excluding fuel, the metric grew 2.1%. The average fuel price per liter surged 61.4% to $3.36.

Total operating expenses increased 20.5% to $674.05 million due to the 56% increase in fuel costs. Expenses on wages, salaries and other employee benefits fell 9.7% on reduced headcount. Sales and distribution costs increased 15.6% due to higher sales. Passenger servicing costs dropped 20.3%. Flight operation costs increased 6%.

Copa Holdings exited the first quarter with cash and cash equivalents of $242.31 million compared with $122.42 million at the end of December 2022. Total debt, including lease liabilities, was $1.7 billion, flat sequentially.

CPA ended first-quarter 2023 with aconsolidated fleetof 99 aircraft, which comprises 67 Boeing 737-800s, 22 Boeing 737 MAX 9s, nine Boeing 737-700s, and one Boeing 737-800 freighter. During the reported quarter, the carrier took delivery of two Boeing 737 MAX 9 aircraft.

Outlook for 2023

For 2023, Copa Holdings has updated its outlook. Consolidated capacity or ASMs is now anticipated to register 12-13% growth (prior view: 12-14%) in 2023 compared with 2022, and the operating margin is now expected to be between 22% and 24% (prior view: 17-19%). The load factor is still expected to be around 85%.

Currently, Copa Holdings sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Performances of Other Transportation Companies

Delta Air Lines’ (DAL) first-quarter 2023 earnings (excluding 82 cents from non-recurring items) of 25 cents per share missed the Zacks Consensus Estimate of 29 cents. Volatile fuel prices and unfavorable weather conditions led to this downtick. DAL reported a loss of $1.23 per share a year ago, dull in comparison to the current scenario, as air-travel demand was not so buoyant then.

DAL reported revenues of $12,759 million, which missed the Zacks Consensus Estimate of $12,767.4 million. Driven by higher air-travel demand, total revenues increased 36.49% on a year-over-year basis.

Alaska Air Group, Inc. (ALK Quick QuoteALK - Free Report)  reported first-quarter 2023 loss of 62 cents per share, wider than the Zacks Consensus Estimate of a loss of 48 cents. In the year-ago quarter, ALK incurred a loss of $1.33 per share.

ALK’s operating revenues of $ 2,196 million missed the Zacks Consensus Estimate of $2,202.5 million. The top line jumped 31% year over year, with passenger revenues accounting for 90.3% of the top line and increasing 31% owing to continued recovery in air-travel demand.