Volaris (VOLARA) Q4 2024 earnings summary

Executive summary

• Achieved net profit every quarter in 2024, with full-year net income of $126 million and a 36% EBITDAR margin, despite significant fleet groundings and capacity cuts due to GTF engine inspections.

• Maintained stable revenue at $3.1 billion, carrying 29.5 million passengers with 13% fewer ASMs year-over-year, and total operating revenues declined 4% for the year.

• Ancillary revenues exceeded 50% of total revenues, with per passenger ancillary revenue reaching a record $57 in Q4.

• Recognized for safety and sustainability, including top 10 global low-cost carrier safety ranking and Dow Jones Sustainability Index inclusion.

• Strengthened customer preference with a Net Promoter Score of 37.4% and operational excellence (99.5% schedule completion, 83.6% on-time performance).

Financial highlights

• Full-year net income reached $126 million, up from $8 million in 2023, with EBITDAR of $1.14 billion (+39%) and EBIT of $413 million (+85%).

• Fourth quarter operating revenues were $835 million, down 7% year-over-year, impacted by a 20% peso depreciation.

• Net debt-to-EBITDA ratio improved to 2.6x from 3.3x.

• Operating cash flow exceeded $300 million in Q4, with year-end liquidity at $954 million (30% of LTM revenue).

• Average economic fuel cost dropped 20% to $2.51/gallon in Q4, aiding margin improvement.

Outlook and guidance

• 2025 ASM growth expected at around 13%, still below 2023 levels, with 40% of capacity allocated to international markets.

• Full-year 2025 EBITDAR margin guidance is 34%-36%; CapEx projected at $250 million.

• First quarter 2025 guidance: ASM growth ~7%, TRASM $7.9-$8.0¢, CASM ex-fuel $5.5-$5.6¢, EBITDAR margin 28%-29%.

• FX assumptions: 21-21.2 MXN/USD for 2025, 20.6-20.8 MXN/USD for Q1.

• Peso depreciation and seasonality expected to pressure near-term revenue.