Copa Holdings, S.A. (CPA) Q2 2022 Earnings Report, Transcript and Summary

Ladies and gentlemen, thank you for standing by. Welcome to the Copa Holdings Second Quarter Earnings Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this call is being webcast and recorded on August 4, 2022. Now, I will turn the conference over to Daniel Tapia, Director of Investor Relations. Sir, you may now begin.

Thank you, Catherine. And welcome everyone to our Second Quarter earnings call. Joining us today are Pedro Heilbron, CEO of Copa Holdings and Jose Montero, our CFO. First, Pedro will start by going over our second quarter highlights, followed by Jose, who will discuss our financial results. Immediately after, we will open the call for questions from analysts. Copa Holdings financial reports have been prepared in accordance with International Financial Reporting Standards. In today's call, we will discuss non-IFRS financial measures. A reconciliation of the non-IFRS to IFRS financial measures can be found in our earning's release, which has been posted on the company's website copa.com. Our discussions today will also contain forward-looking statements, not limited to historical facts that reflect the company's current beliefs, expectations and/or intentions regarding future events and results. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially and are based on assumptions subject to change. Many of these are discussed in our annual report filed with the SEC. Now, I'd like to turn the call over to our CEO, Mr. Pedro Heilbron.

Thank you, Daniel. Good morning to all and thanks for participating in our second quarter earnings call. Before we begin, I'd like to thank all our co-workers for their commitment, to the company, and recognize their continuous efforts and dedication to keep Copa at the forefront of Latin American aviation. To them, as always, my utmost respect and admiration. As all of you are aware, the significant increase in jet fuel prices has put serious pressure on the operating cost of the entire airline industry. This impact was especially noticeable in the second quarter in which in our case, the effective price of jet fuel increased more than 86% when compared to the same period in 2019. On the positive side, passenger yields for the quarter came in higher by 10.1%, partially offsetting the additional fuel costs. The combination of these two factors plus our ability to control our non-fuel related cost enabled us to deliver a 6.1% operating margin and an adjusted net profit of $13.2 million in Q2. Now, I would like to mention the main highlights for the quarter. Our capacity reached 97% of second quarter 2019 ASMs, RPMs decreased 3.8% when compared to Q2 2019, resulting in an 84.8% load factor. Passenger yields came in at $0.13 or 10% higher than in the second quarter of 2019 while cargo revenue was 62% higher, resulting in unit revenues or RASM of $11.6 and 11.3% increase compared to the second quarter of 2019. Ex-fuel CASM decreased from 6.2 cents in Q2 2019 to $0.06, representing an almost 5% decrease on 3% less capacity and, on the operational front, Copa earnings delivered an on-time performance of 85.9% and a completion factor of 99.8%. In terms of fleet, during the quarter, we took delivery of one 737 MAX 9 to end the quarter with a total of 94 aircraft, reaching 92% of our year-end 2019 fleet size. With the addition of this aircraft and the expected remaining deliveries for the year, more than 20% of fleet will be composed of MAX aircraft, resulting in valuable fuel efficiencies. This figure has also included our recently retrofitted 737-800 freighter, which operated during the entire quarter, carrying almost 30% of our total cargo volume. By shifting most of our previously third party cargo operation to the retrofitted freighter, we're able to transport higher cargo volumes at lower cost. In terms of our network, Copa Airlines started operations in two new cities during the quarter, Santa Marta in Colombia and Barcelona and Venezuela, ending the quarter with service to 76 cities in 32 countries compared to 80 cities in 33 countries in year-end 2019. We also announced a new service to the Santa Lucia airport in Mexico City, starting in September, which will complement our existing service to Mexico City as we continue strengthening and solidifying our position as the most complete and convenient hub in Latin America. Turning now to Wingo, Wingo continues its regional expansion with the announcement of four new routes starting in October. With this addition, we will operate 31 routes with service to 21 cities in 10 countries. [Technical Difficulty]. So, you can see despite the current fuel price environment affecting the entire airline industry, we have established our capacity and network to near pre-pandemic levels and continue delivering profitable financial results. Looking ahead, we continue to see a recovering demand environment in the region and healthy booking trends, which lead us to anticipate an increase in our unit revenues for Q3 and consequently to expect higher operating margins quarter over quarter. In Q3, we also expect to bring back our capacity, measured in ASMs, to a 100% of our pre-pandemic levels. Nonetheless, considering the uncertainty of the current economic environment, we remain cautious and continue to closely monitor demand patterns in the region. So, we will remain focused and flexible in terms of capacity, adjusting our plans as needed. I would like to conclude by reiterating that we have a proven and strong [Technical Difficulty], convenient network for intra-Latin America travel from our Hub of the America, leveraging Panama's advantageous geographic position with low unit costs, best-on-time performance, and a strong balance sheet and we expect that our Hub of the Americas will continue to be a valuable source of strategic advantage. Now, I'll turn it over to Jose, who will go over our financial results in more detail.

Thank you. Pedro. Good morning everyone, thanks for being with us today. I'd like to join Pedro in acknowledging our great team for all their efforts to deliver world-class service to our passengers. I will start by going over our second quarter results. Capacity came in at 6 billion available seat miles, which is approximately 97% of our Q2 2019 capacity. Those factor came in at an average of 84.8% for the quarter, at 0.4 percentage point decrease compared to the same period in 2019. Our adjusted net profit for the quarter, excluding special items, came in at $13.2 million or $0.32 per share. Second quarter special items totaled $111 million comprised of unrealized mark-to-market gain of $113.7 million related to the company's convertible notes and a $2.7 million unrealized mark-to-market loss related to changes in the value of financial investments. We reported a quarterly operating profit of $42.3 million and an operating margin of 6.1%. Driven by higher jet fuel prices, unit cost or CASM increased 19.9% versus those of Q2 2019 of 10.9 cents. Our CASM excluding fuel came in at $0.06, a 4.6% decrease compared to Q2 2019, even though we operate a 3% less capacity and finally, driven by a 10.1% increase in yields, unit revenues came in at 11.6 cents or 11.3% higher than in the second quarter of 2019. I'm going to spend some time now discussing our balance sheet and liquidity. As of the end of the second quarter, we had assets close to $4.4 billion and, in terms of cash, short and long-term investments, we ended the quarter with $1.1 billion, which represents 47% of last 12 months' revenues. As to our debt, we ended the quarter with $1.6 billion in debt and lease liabilities at similar levels to those reported as of the end of the first quarter of 2022. And our adjusted net debt to EBITDA ratio came in at 0.8 times. Turning now to our fleet, during the second quarter, we received one Boeing 737 MAX 9 to end the quarter with a total of 94 aircraft. Our total fleet is comprised of sixty eight 737-800s, seventeen 737 MAX 9s and nine 737-700s. These figures include three 737-700s, which ended the quarter in temporary storage and one 737-800 freighter. For the second half of the year, we expect to receive four additional 737 MAX 9 aircraft and so we expect to end the year with a fleet of 98 aircraft. We have financed these deliveries through sale and leaseback transactions, increasing the proportion of operating leases to above 30% of our total fleet, ensuring we continue to have a flexible fleet plan going forward. In 2023, we expect to receive 13 additional aircraft, 11 Boeing 737 MAX 9s and two Boeing 737 MAX 8s. We've already secured financing for the first six of these deliveries through [indiscernible] constructors. Turning now to our outlook for the third quarter of 2022. Based on the current state of demand environment and the current expectation of the price of jet fuel, we can provide the following guidance. We expect capacity to be back at approximately 100% of Q3 2019 levels. We're about 6.4 billion ASMs and we expect our operating margin to be in the range of 16% to 18%. We are basing our Q3 2022 outlook on the following assumptions, load factor of approximately 86%, unit revenues of approximately 12.7 cents, CASM ex-fuel of approximately $0.06 and all-in fuel price of $3.80 per gallon. Regarding full-year 2022, we reiterate our expectation of achieving approximately 98% of 2019 ASMs and a CASM ex-fuel of approximately 5.9 cents. Thank you. And with that, we'll open the call to some questions.

Thank you. [Operator Instructions]. Our first question comes from Duane Pfennigwerth with Evercore ISI. Your line is open.

Hey, good morning, this is Jake coming on for Duane, I realize that it's early, but could you offer any thoughts on your 2023 capacity plans? 4Q is already implied at 100% of 2019. So, could we see capacity up over 10% next year?

Hi, this is Pedro. So, the fleet plan we have published takes Copa Holdings from 98 aircraft at the end of 22 to 108 at the end of '23, but it could be even a little bit more. If we renew all of our leases, it could even be 111. So, if we do the math there, I mean, and I should first said that we have not yet guided to ASM growth for 2023. So, we're only guiding for Q3, but if you look at our fleet plan and you do the math, it's going to be like low-double digits, I would say.

Okay. Yeah, that makes sense. Thank you. And then could you just confirm that the $120 million that you bought back was roughly 4% of the stock in the second quarter.

Yeah, I think that sounds about right. I think, yeah.

Okay, thank you.

It's in the range.

Yeah.

We have a question from Savi Syth with Raymond James. Your line is open.

Hey, good morning, Just kind of curious on the demand and the revenue outlook is really strong here and is there kind of a particular region or trip type business or leisure that's driving this revenue recovery strength?

Hi. Savi. Pedro here. So, I would say that it's across the board. There is not one particular region that's underperforming or I mean, in no significant weight, and we need to keep in mind that in part is a reaction to higher fuel prices. Strong demand allows us to produce better yields and it also allows the fact that fuel affects everyone pretty much the same, it allows for yield improvement to be more sustainable, at least for now. So, I would say it's across the board.

And the other thing I'll add Savi is we got to remember that Q3, from a seasonality perspective, is a strong quarter for us, sequentially from Q2, which is the sort of the weakest quarter of the year from a seasonality perspective to Q3. You also see that difference in the resin, however, as Pedro mentioned, we're following closely the demand and the macroeconomic environment, the fuel impact and so we are very closely paying attention to [Technical Difficulty] that we see in the region.

And on the business versus leisure part of that, is seeing anything different?

Business has improved slightly, but it's still half of what it was in 2019, but we see an improving trend.

Yeah. And on sequential basis, it has gotten better or in the course of the year. Yeah.

Helpful and then if I might, just a quick question on the fleet, the. It does look on the fleet plan, there are MAX 8s coming, I thought initially that kind of the plan was for MAX 9s and 10s and I know 10s are 35 yet, is that a kind of a change in strategy there. I know it looks like maybe one MAX 9 has slipped from this year to next year, so maybe it's just the fact that Boeing has [indiscernible] available. I was just curious what the strategy behind the fleet plan.

Yeah. We were always planning to get the MAX 8s and we only need a kind of a set number of MAX 9s, which we use for our longer segment. So, we get two MAX 8s that the plan next year and we will continue getting more MAX 8s and probably a few more MAX 9s that we still have to receive to get to the set number.

And our fleet plan and our order with Boeing has enough of flexibility that we can determine which subtype we would receive in due course.

Are you able to share kind of what the right size of MAX 9 is there?

The MAX 9s are going to be. Yeah, it's going to be in the low '30s. It's going to be in the low '30s, the rest are going to be most likely MAX 8s. We have options in the MAX 10s also. So we haven't made a final decision there, but that's kind of how it looks right now.

Perfect, all right, thank you very much.

Our next question comes from Alejandro Zamacona with Credit Suisse. Your line is open.

Thank you. Hi Pedro, Jose.Thank you for the call. A quick question on the CASM ex fuel and so beyond the 5.9 cents guided for the full year 2022, what has been the strategy to lower the costs despite the higher inflation environment. What can we expect from labor, marketing, and maintenance in the medium term?

I'll start with a few comments and then Jose can pitch in. So, we are operating with higher gauge. So, we have more and more seats in our aircraft which allows us to spread our fixed overhead costs. We've also, since the pandemic, accomplished some important savings in overhead, which also helped in our CASM ex and have been very disciplined again since the pandemic in renegotiating a lot of contract, it's part of how we survive the worst of it. So that's also part of what we've been able to accomplish and we're always, as you know, very, very nimble with our cost as much as we can.

I'll just add that going forward, Alejandro, we, as we've discussed before, also have a plan to densify our 737-800 fleet and so that will also provide for reduction in CASM ex and, as Pedro mentioned, we have a very lean overhead structure. We've been very active in contract negotiations and some of those mitigate some of the increases that we've seen in certain parts of the network as well, and we're also, of course, working in other avenues, such as distribution and the like that should also improve our CASM in the medium to long term.

Okay, thank you. It makes sense. And then my second question, if I may, in terms of the capital allocation, is there any change in the strategy, I mean, a full recovery and also if you can share any update on the potential dividends.

Yeah. Look, our focus as a company has always been to return value to our shareholders. And as part of that, we've been active in our share repurchase program, which serves as a conduit to manage some of the liabilities that we had to take on during the pandemic. So, that's our main focus right now and, of course, this is something that we look forward, we have a set dividend policy that we had even before the pandemic. So that's something that in due course will be addressed as well, but again I just want to reiterate how important it is for us to return value to our shareholders. In addition to that, from the operational standpoint, we also have a set of aircraft arriving, which require pre-delivery deposits with Boeing and, as you saw, we have 13 things coming into next year, et cetera. So that's also part of our capital allocation strategy to grow the business.

Thank you, sir.

We have a question from Michael Linenberg with Deutsche Bank. Your line is open.

Yeah. Hey, good morning everyone. Pedro, just I want to touch back on Wingo. You talked about regional expansion and you listed a number of cities by October and countries. Does that include the new service, I think, that you're planning to Argentina and, if that's the case, what's the fleet size at that point, because I would think that a flight to Argentina back and forth would probably use up a the single airplane system. Some additional color on that operation.

Yeah, it actually [indiscernible] in our plane. The way we operated at wee hours, so [indiscernible] airplane, it's contemplated in aircraft number nine, but they will get eventually aircraft number 10. So, there will be enough for them to serve that market and other, but Wingo grows carefully. We're very conscious of the competitive market in Colombia and the region. So, Wingo does not have like a set plan to grow for the sake of growing. It grows to gain strength and be successful. So, we measure every step like we always do so and Wingo is no different in that regard.

Pedro, is it fair to say, for high density, no frills type service, usually when you get beyond stage lengths of three and four hours, it becomes a much more difficult value proposition. But then when I look at some of the changes going on in the region. It seems like competitor airlines are doing very long haul with single class type layouts and so maybe that creates more opportunities for the Wingo product. Is that a fair sort of assessment of the competitive playing field?

Yeah, I mean, it could be. We're still learning also. So, it could be.

Okay. And just my second question on cargo. When I look at your passenger revenue up 6% versus 19% and other up 20%. Cargo is up 62% and I realize it's obviously being driven by the freighter, but absent the freighter, would your cargo revenue have been the growth rate, something more similar to maybe the other up 20% because I am sort of incorporating the higher cargo yields that we're seeing in the marketplace, and I'm trying to get at how much that single airplane has added. It looked like it was a meaningful contribution on the topline, at least from a growth rate perspective.

Right. I mean it's meaningful but not as much as it seems because before if previous to the freight, our own freighter, we were chartering a freighter aircraft from cargo operator. So what we have done, we've been able to a little bit more than double the hours and that were flown before by the charter freighter so we've doubled that with our own freighter. So, I would say we would have grown, probably more than 20% even without the freighter.

Okay. Okay. I guess I'm getting a sense of-- there is a big cargo opportunity in your part of the world. I know you're going very slowly, but if every airplane adds, I don't know, $5 million to $7 million to $10 million quarter of revenue, we're just getting a sense of maybe the opportunity but thanks for answering my questions.

Thank you, Mike.

Thank you. We have a question from Alberto Valerio with UBS. Your line is open.

Hi Pedro and Jose. Thank you for taking my question. First of all, the [indiscernible] guidance for the third quarter, I'd like you to add some color why next quarter would be a good quarter and related [indiscernible] debts. Usually when we see [indiscernible] jet fuel going down, we also [indiscernible] going down and even not just for seasonality, the third quarter, we have [indiscernible] yields on our estimate of 4% and as you quoted jets fuel going to 3.8, this is my first question. My second question is about the supply demand environment beyond the third quarter looking maybe [indiscernible] 0:35:56 fourth quarter. If the Brazilian airlines adding capacity in the international markets, this may impact your guidance in the fourth quarter, you might wait or you might see some pressure on yields for us [indiscernible]. Thank you.

Yeah, Alberto. I'll touch on the third quarter question and let me start by saying that you are correct. Lower fuel prices could impact the yield environment given the competitive dynamics. We do believe, however, as I mentioned that the third quarter has historically high season component to it, more so than the second quarter. And number two, let's not forget that a portion of what we are going to reflect as revenues during the third quarter has already been sold during the second quarter when fuel was still going up. The movement in the fuel price has been very recent during the month of July, so the impact on specifically the third quarter in terms of yields will not necessarily come in such a strong way given that a portion of the quarter was already sold with very, very high fuel price environment, but, as you could imagine, we're very closely following the macro operating environment, just to adjust our pricing et cetera and just to make sure that it's all competitive. And in terms of the fourth quarter and competitive demand, yes, we're following that [Technical Difficulty] and the impact on our yields specifically related not just to the fuel environment, but also to the currency and macroeconomic forces that are around in the world right now, so we are following very closely, both items both on the competitive landscape and the fuel and the macroeconomic environment.

That make sense, thank you very much.

Our next question comes from Stephen Trent with Citi. Your line is open.

Good morning, gentlemen. And thanks very much for taking my questions. Just two quick ones from me. First, follow-up on your network comment. So when we think about the recovery of the network, is it still accurate to say that roughly 75% of your destinations you're still moving 40 some odd passengers or less round trip each day?

Yes, that that hasn't changed much. I agree.

Great. Thank you.

Our calculation show that around 75% of all origin and destination points have less than 20 passengers per day in the total market size. So, it's a small figure of [indiscernible] the passengers in the majority of [indiscernible] the markets that we operate in.

Okay, great. Thank you, Pedro and Jose. And just real quick, could you just give me high level refresher where you are with Tocumen airport. I know there was new lounges going up and the new wing and what have you--if you could just refresh my memory please.

Yeah. So finally after mentioning the soon-to-open new P2 terminal during so many earnings call, we mentioned so many times that we stop saying it. So, we would jinx so, It finally opened in June, if I'm not mistaken, it is working well. No hiccups. We also inaugurated a new Copa club, a very large and nice club at the new T2, which we think is an asset for us given our business model and how we connect passengers and the [indiscernible]. So, we're very happy with having the new facilities, which takes Tocumen airport from 34 to 54 gates, even though some of those 20 new gates we were already using but also we have new check in facilities, much more space in customs and immigration and the whole thing. So, it gives us some runway to continue growing in the next number of years.

Okay. That is super. Really appreciate that.

Thank you, Stephen.

We have a question from --

It's kind of a follow-up to Savi. How would you say that the capacity is recovering among leisure and corporate relative to 2019 and also if corporate reaches pre pandemic levels, what do you think will be the upside for deals for the next two quarters, for example. Thank you.

Right. So both business, I mean we have corporate accounts and has not passed a significant number of it, let's say, for our US airline in the US and then we have business travelers, which might not have corporate accounts. So, when we put all that together, it's still around half of what it used to be, maybe a little bit better than that. It's been improving slightly quarter-over-quarter and may be slightly above 20% of our overall business right now. We're still seeing strength in demand. Current and future is in leisure. So, that's what's been driving the demand strength throughout the region, but again, business and corporate is recovering quarter over quarter, even though at a slow pace.

Thank you very much, Pedro, it is very interesting. What do you think will happen when you have the corporate already at a 100 or very close to because the yields are already very high, so just want to assess like the magnitude of the [indiscernible] yields.

Yeah, the yields right now reflect a very high fuel price environment as we know and the fact that that's something affecting the whole industry. We're not banking on that forever and that's why we're so conscious about our ex-fuel CASM and if fuel comes down, so do yields, we will be fine, too. So, we're not banking on anything. And right now, we're not expecting business and corporate to be at a 100% in the near term.

Okay, perfect. Thank you very much.

Thank you, Pablo.

We have a question from Daniel McKenzie with Seaport Global. Your line is open.

Hi. Hey, thanks, good morning. My question is a follow-up on some of the prior questions. So, I'm going to come out of it a little bit differently. What's your best estimate for when corporate volumes return to 2019 levels. So, volume question specifically and, then tied to this, how would you characterize business confidence in the region. Is there a pent-up demand or are you thinking there is a permanent impairment given the trend to remote working. Whatever you can share with respect to anecdotal conversations or surveys is helpful. With the Dreams product, I have to believe it's going to be a little better at this time around for you guys, but I don't want to put words in your mouth.

Yeah, well, first I should say that our business class loads are better than pre-pandemic even though business traffic is down as we just spoke about and also leisure traffic is taking up some of that space. So, that's a positive. When will business travel will be back, hard to tell. It's going to be longer than what it would have been without all the technologies for remote work and everything, but we know it will eventually be back, of course, because it's going to continue growing, we know that, but how long it's going to take, hard to tell because, there are in the needs as before to be there in person for every single meeting, but the value of personal travel is irreplaceable, technologies don't make up for it. We see it in our own business. There is now a number of business meeting that have to be in person because there's no other way of being effective and same with visiting clients and supplier visiting also. It's going to be step by step, it will take some time and it's really hard for us to predict.

And I think Dan that your interesting aspect is that as garments drop requirements for visiting or for traveling that also should boost business travel going forward. So, we see good eyes as governments have removed testing requirements predeparture and the sort of hindrances that occurred before travel over the last several years and that's I think also going to boost business demand going forward.

Okay. And then second question here, just same theme coming some of the prior questions a little differently here. How are you assessing the restoration of some of the larger Latin American markets? So countries where you're seeing areas of strength, areas of weakness. And I guess what I'm getting at is Brazil once upon a time was a really strong end market. I think once upon a time, 20% of your revenue, and it just seems like there is a longer-term path to better revenue, but it's just helpful to get a reality check along the way here as you kind of think about areas of strength and weakness.

Right now, our network is very balanced. Most markets are doing well as per the capacity we have deployed. So, we haven't reopened every single city we were flying to before, we're not operating at the same level everywhere. We're not on a 100% capacity yet and so there have been some shifts there, but related to the capacity we have deployed, I would say most markets are doing well and, in a similar way, we don't see big differences in that sense.

Okay, thanks for the time guys.

Thank you. Dan.

Our last question comes from Helane Becker with Cowen. Your line is open.

Great. Thanks, operator. Thanks for squeezing me in. Good to hear from you guys. So what's the competitive situation like in Panama right now. Are you seeing some of the other airlines in the region increasing serviced through the airport? What about reinstatement of flights from Europe and the competitive situation there because for a long time you guys had codeshares with KLM and others and bringing in large plane full of people to go elsewhere in South America. So just kind of wondering how competition is shaping up in the market now?

Okay. Well, as you know, most of our competition happens outside Panama and it's usually hub against hub or non-stops against our hub. So, the battles are usually fought outside Panama. However, what you're mentioning is very important to us, which is the connectivity with a number of different carriers that serve Panama serve our hub and actually are able to sustain the number of frequencies by connecting with our network, especially the European like you've mentioned. So, some of them are back to near pre-pandemic levels like KLM and Air France. They are close to daily flight each. Those are important fits[ph] for us and by the way we port share with all. With all the European that fly to Panama, we port share. Iberia is also near pre-pandemic levels. Turkish is at pre-pandemic and planning to grow. Lufthansa has been replaced by Eurowings, which is part of the Lufthansa Group and they are slightly below, but they're talking about growing also and then Air Europa something similar. So, I think we are somewhere between 80% and 85% of the seats that were coming in from Europe pre-pandemic and growing and the connectivity between Copa and these partners is also growing.

That's great. That's great to know. All right. Is the airport--I know, somebody asked about the airport before but is the new airport from a customs and immigration perspective well staffed and are you able to move people through the airport in a speedy fashion?

For passengers departing or arriving to the city of Panama, local passengers, the facilities are much better. They are well staffed, very nice ample room for back. The whole thing before was quite congested, but you know when you when you go somewhere, it's usually your only choice. So, it doesn't make much of a different. In terms of connecting passengers, the new terminal is very nice. Our new Copa club is truly amazing and we have more gates, which is very important. So, as we grow in the coming years, it will be a while before we need to use remote positions again and that's a big positive. The only negative is walking distances can be quite long from one extreme to the other, it's not uncommon in most airports and major hubs, but some of our passengers are not used to that, but we're selling the health side of walking and exercise that we do.

Yeah, it's good, it's good. Walking is good, but also we try to make sure that flights that connect to each other have or with significant connecting flows kind of are nearer to each other, et cetera. So, our operational team does a great job at assigning gates in particular at the airport, walking is good.

Walking is good for you. Okay, thanks guys.

Thank you. Helane.

There are no other questions in the queue, I'd like to turn the call back to management for closing remarks.

Okay. Thank you, operator and thank you all. This concludes our earnings call. Thank you for being with us. Thank you for your continued support. Have a great day and we'll see you in the next one. Thank you.

This concludes today's conference call. Thank you for participating. You may now disconnect.

Thank you.