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GOL Linhas Posts Solid Traffic in November, Load Factor Up

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GOL Linhas Aéreas Inteligentes S.A. reported impressive traffic figures for November 2018. Load factor (percentage of seats filled by passengers) improved as traffic growth outpaced capacity expansion.

Consolidated traffic, measured in revenue passenger kilometers (RPK), increased 5.7% to 3.27 billion. Domestic RPK expanded 2.9% and international RPK rallied 30.8%. On a year-over-year basis, consolidated capacity (or available seat kilometers/ASKs) expanded 4% to 3.96 billion. Domestic ASK and international ASK improved 1.1% and 27.5%, respectively. The carrier posted 4.7% rise in passenger count. Load factor increased to 82.6% from 81.3% in the year-ago period. However, departures in the month declined 2%.

At the end of the first 11 months of 2018, RPK and ASK were up 2.8% each. Load factor for the period was flat at 79.6%. Volume of departures inched down 0.1%, while number of seats rose 2.4%.

 

In spite of reporting impressive traffic figures, GOL Linhas has been facing high costs which are expected to limit bottom-line growth in the final quarter of 2018. Despite the current downtrend, the bottom line is hurt due to costs related to aircraft fuel. The company expects fuel costs for 2018 to be R$2.9 per liter. Additionally, expenses pertaining to the labor front may hurt the bottom line.   Such a scenario marred the company's projection for the current-year loss per share. GOL Linhas estimates loss per share in the range of R$1.8-R$2 in the current year compared with the previous expectation of R$1-R$1.20.

Zacks Rank & Stocks to Consider

GOL Linhas carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the Zacks Transportation sector are Frontline Ltd. (FRO - Free Report) , Hertz Global Holdings, Inc. (HTZ - Free Report) and Spirit Airlines, Inc. (SAVE - Free Report) . While Hertz Global carries a Zacks Rank #2 (Buy), Frontline and Spirit Airlines sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Hertz Global, Frontline and Spirit Airlines have gained 11.7%, 22.1% and 69.8% in the past six months, respectively.

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