Copa Holdings, S.A.

Ladies and gentlemen, thank you for standing by. Welcome to COPA Holdings' second quarter earnings call. During the presentation, our participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. At that time, if you have a question, you will have to press star, then 1 on your touch-tone phone. As a reminder, this call is being recorded on August 5, 2021. Now I will turn the conference over to Daniel Tapia, Director of Investor Relations. Sir, you may begin.

Thank you, Stephanie, and welcome everyone to our second quarter earnings call. Joining us today are Pedro Helron, 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. COPPA holding 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 earnings release, which has been posted on the company's website, coppa.com. Our discussion 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 Gelón.

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 coworkers for their commitment to the company and recognize their continuous efforts and dedication to keep COPPA at the forefront of Latin American aviation. To them, as always, my utmost respect and admiration. As many of you know, Raúl Pascual decided to take on a new professional challenge and left the company earlier last month. We are very grateful for the more than 15 years of outstanding work he dedicated to COPPA. I would also like to take the opportunity to welcome Daniel Tapia, our new Director of Investor Relations. Daniel has over 12 years of experience with the company in many areas, including airports, scheduling, and most recently fleet and network planning. We're very confident in Daniel's ability to lead our investor relations group. As you may remember, in our last earnings call, we discussed two diverging themes happening in Latin America. On the one hand, some countries, including Panama, were experiencing a downward trend in infection rate, which led to fewer travel restrictions and an improved demand environment. On the other hand, several other countries continued to struggle with the virus, which led many of them to re-impose air travel restrictions and or new health requirements, affecting demand for international travel. As of today, the story has not changed much. Due to the increase in COVID-19 cases, several countries have maintained and in some cases increased travel restrictions, which has affected our ability to ring state capacity. On the other hand, markets without significant restrictions, mainly to and from the U.S. and certain leisure destinations, have continued to recover, which has allowed us to increase capacity quarter over quarter while also growing load factors. In the month of June, we successfully transitioned our Hub of the Americas in Panama back to a six-bank connecting structure, which enables cost efficiencies and lets us continue adding back frequencies and destinations. Moreover, we started to reactivate some of the aircraft sent to temporary storage during 2020. Going forward, we assume ongoing vaccination efforts will have a positive effect on COVID-19 infection rates in the region, which we expect will lead to the relaxation of travel restrictions and a faster demand recovery, supporting the capacity deployment for the second half of the year. Now I'll highlight some of our second quarter results. In terms of capacity, we reached 48% of second quarter 2019 ASMs compared to 39% in the first quarter. Load factor came in at 77%, which is an improvement of 8 percentage points compared to the first quarter. Revenues increased by 64% over the previous quarter to $304 million. as a result of the additional capacity, higher load factors, and improved yields. The additional capacity also allowed us to reduce our ex-fuel chasm from 8.5 cents in Q1 to 7.6 cents in Q2. We reported an operating profit of $8.7 million in the quarter, excluding a $10.4 million passenger revenue adjustment the company would have reported an operating loss of $1.7 million. Cash acquisition averaged $21 million per month, which was better than our expectations, primarily due to stronger sales in the quarter. We ended the quarter with a cash balance of $1.3 billion and total liquidity of over $1.6 billion. In terms of our operations, and despite the complexity imposed by the multiple biosafety protocols, we are pleased to report an on-time performance of 92% for the quarter and a flight completion factor of 99.5%, which again places us among the best in the world and is a true testament to our employees' continuous commitment to providing a world-class product to our passengers. Turning now to Wingo, we can report that it's now operating six 737-800s compared to the four it operated pre-pandemic. During the second quarter, Wingo continued its regional expansion with new flights from Panama to San Jose, Costa Rica, and from Bogota to Lima, Peru. And since Q1, it's been operating more capacity than in 2019. To finalize, I'd like to reaffirm that we have a proven and strong business model which is based on operating the best and most convenient network for intra-Latin America travel from our hub of the Americas, leveraging Panama's advantageous geographic position with the region's lowest unit cost for a full service carrier, best on time performance and strongest balance sheet. Going forward, the company expects that its help of the Americas will be an even more valuable source of strategic advantage. Now, I'll turn it over to Jose, who will go over our financial results in more detail.