Controladora Vuela Compania de Aviacion, S.A.B. de C.V.

Good morning, everyone. Thank you for joining Valera's fourth quarter and full year 2025 Financial Results Conference call. All lines are currently in a listen-only mode. After the company's remarks, we'll open the call for questions. Please note that today's event is being recorded and webcast live on Valera's website. At this time, I'll turn the call over to Liliana Juarez, Investor Relations Manager. Please go ahead.

Welcome to our fourth quarter 2025 earnings call. Joining us today are our President and CEO Enrique Beltranena, our Airline Executive Vice President Holger Blankenstein, and our CFO Jaime Poz. They will be discussing the company's results followed by a Q&A session. This call is for investors and analysts only. Please note that this call may include four well-looking statements on their applicable securities laws. These are subject to several factors that could cause the company's results to differ materially. as described in our files with the U.S. SEC and Mexico CNBB. These statements speak only as of the date they are made, and Volaris undertakes no obligation to update or modify them. All figures are in U.S. dollars compared to the fourth quarter of 2024, unless otherwise noted. And with that, I'll turn the call over to Enrique.

Good morning, everyone, and welcome to our fourth quarter 2025 earnings call. As ever, I'm proud of the discipline execution, operational agility, and commitment demonstrated across our organization throughout the past year. I especially want to thank our ambassadors for their hard work and resilience in what was a demanding environment. 2025 was both busy and historic for Volaris. We executed with precision across our network and operations, delivering measurable progress Despite a complex industry and macroeconomic backdrop, including aging constraints, FX volatility, and geopolitical developments that temporarily influenced cross-border travel sentiment. Through disciplined network management, focused pricing strategy, and operational flexibility, we continue strengthening the foundation of our business. In the fourth quarter, we delivered 5.6% capacity growth and drove T-RASM toward the levels recorded in the same period of 2024. At the same time, we strengthened revenue quality with ancillary revenues comprising 56% of total operating revenues, reinforcing the structural advantages of our ultra-local carrier model. We also initiated targeted capacity growth in the U.S. with roots maturing as planned, all while maintaining a healthy level of cash as a percentage of revenues of 25.5% and strong causticity. During 2025, we kept Cosmex Fuel in line with plan at 5.58 cents. while proactively adjusting ASM growth from an originally planned mid-teens increase down to 6.3%. These actions ensured our shift offering remained aligned with demand while prioritizing profitability. Equally importantly, we delivered on our guidance, finishing 2025 with a full-year EBITDA margin of 32.5%. performance, strengthened as the year progressed, reinforcing the improving trajectory of the business as we move into 2026, and demonstrating that our strategic and operational initiatives are gaining traction. More specifically, in the cross-border market, travel sentiment continued to improve sequentially, in line with our expectations. We matched demand with disciplined capacity deployment and the Mexico-U.S. capacity added in the second half of the year, generated positive results as roots continued to mature. Fourth quarter international low factor reached 79%, up from 77.5% recorded in the first nine months of the year. In the domestic market, low factor reached 89.8%, reflecting discipline supply adjustments to align with demand across the network. As the best-in-class carrier operating in a structurally growing and under-penetrating emerging market, we remain focused on stimulating demand through our low-fare model, supporting profitable growth, capital efficiency and long-term value creation by continuing to connect families, communities and business across Mexico and beyond. As we enter 2026, The Mexican economy is showing earlier signs of improvement, supported by recovering consumption trends and better than expected inflation performance. The economy-wide wage bill has recovered part of the ground lost during most of 2025, supporting improving consumer confidence and households' expectations around purchasing durable goods and making travel plans in the coming months. For the year, we are expecting ASM growth of approximately 7%, fully aligned with our discipline deployment strategy. Most of the incremental capacity will be allocated to international markets, where we have seen sequential improvement in tierism since last August, supported by encouraging first quarter booking trends. Domestically, we continue to support the balanced supply-demand environment, scaling capacity in line with improving demand indicators. Our 2026 growth will be managed through three levers. The first one, scheduled airbus deliveries, the second one, AOG reduction, and the third one, aircraft lease returns. Together, they enable a balanced and controlled fleet profile that supports disciplined growth with flexibility and enhanced asset productivity. We are now at an inflection point in aircraft on ground or AOGs, and we expect this trend to improve progressively toward year end. We expect more meaningful acceleration in grounded aircraft returning to service as we move into the summer and the second half, and Jaime will discuss this in greater detail. To support this recovery, we are proactively advancing certain maintenance events and inducting roughly twice as many engines as in 2025, with a significant improvement in turnaround times. While this implies higher temporary near-term costs and a little bit more capex, we view it as a disciplined investment that accelerate inspections, shortens downtime, and allow us to restore fleet availability We're focused on increasing the share of productive aircraft in our total fleet as doing so allows us to generate greater productivity from our existing asset base without adding leverage. This in turn strengthens our earnings profile and improves free cash flow conversion. Many of you have asked about our strategy to return capacity to service without creating excess supply in the market. I want to be very clear that our capacity decisions have been and will remain firmly anchored in customer demand and sustained profitability. Our flexible fleet and engine management framework allows us to dynamically adjust deployment as conditions evolve. We are fully in control of our growth trajectory, not only for 2026, but also for 2027 and 2028, when we expect to have the engine availability constraints normalized and fully behind us. Against this backdrop, the setup, as we move into the back half of the decade, presents a compelling opportunity for Volaris to drive long-term shareholder value. Our ultra-low-cost customer remains the main source for our growth. As you know, in December, we entered into an agreement with Viva to create an airline group to accelerate our carrier's expansion of air travel penetration in Mexico and beyond. Strategically, the proposed airline group represents a natural next step to broaden access to low-fair travel in the domestic and cross-border markets. while preserving our unique brands and passenger choice. As both carriers share a common ultra low cost carrier foundation and compatible fleets, the formation of the Erlang Group is consistent with Volaris' commitment to low cost, low complexity growth for all stakeholders. The regulatory process is moving forward as expected, and we remain in active dialogue with the relevant authorities We have filed with Mexico's National Antitrust Commission and have already responded to the first round of information requests. In parallel, on March 5th, alongside the call for the Extraordinary Shareholders Meeting to be held on March 25th, we will publish the Transactions Prospectus or Folleto Informatica. At this stage, we continue to expect the overall regulatory review processes to take up to 12 months from the merger announcement date. We will provide updates on our earning calls as we advance throughout the process and reach new milestones. Now, I will now turn the call over to Holger to continue to discuss our fourth quarter commercial and operational performance as well as our commercial plans and outlook for 2026.

Thank you, Enrique. Our fourth quarter operations reflected disciplined planning and strong execution across the network, supporting solid operational and revenue performance. As Enrique highlighted, our cross-border markets continue to demonstrate stable recovery, even as northbound flows moderated year over year during the holiday period. We were particularly encouraged by the 79% load factor on international routes in the fourth quarter. A solid outcome given the more challenging backdrop earlier in the year, particularly in the second quarter. This marks a clear improvement versus the first nine months of the year that exceeded our expectations and brings us closer to our historical low 80s median load factor for this market. In the domestic market, our 89.8% load factor reflected steady demand in a balanced supply environment. Weather-related disruptions, including persistent severe fog in Tijuana and other stations during December, led to temporary cancellations and resulted in lower quarterly capacity growth of 5.6% versus our guidance of approximately 8%. We estimate the P&L impact of this extraordinary weather-related operational disruption was approximately $7 million. At the same time, rebookings deep into the holiday season affected the take-up of higher yielding clothes in demand. Nevertheless, we delivered fourth quarter TRASM of 9.35 cents. In line with our guidance, and consistent with a strong result from the fourth quarter of 2024. By actively managing our capacity and remaining responsive to demand trends across our network, we drove Trasm to converge year over year toward the level of a strong fourth quarter of 2024. Our top line resilience continues to be supported by outstanding ancillary performance, with ancillary revenues per passenger increasing 6% versus 2024, along with emerging benefits from our segmentation initiatives. As we enhance our product suite, capture more diverse customer base, and customize our pricing strategy, we are seeing structural tailwinds emerge from Fairmix yields and margins as our revenue grows. A clear example of this is Premium Plus. Introduced in October last year, our blocked middle seat product in the first two rows of the cabin is designed to better address needs of more diverse customer segments. By the fourth quarter, despite still being in its ramp-up phase, performance has exceeded our expectations, supported by strong uptake and positive customer feedback. The key to our success remains low cost, low complexity development of ancillaries that generate high returns on investment. In 2026, we anticipate a compounding effect across our affinity portfolio as we drive enrollments and channel our customers into our loyalty program altitude, where we have already achieved an encouraging base of approximately 800,000 enrollments in just seven months. We are on track to integrate Altitude with our co-branded credit card by the end of the second quarter, allowing all card transactions to earn loyalty points. Demand for our higher value products remains strong. In the domestic market, approximately 60% of our traffic already consists of leisure, business, and multi-reason travelers who choose Volaris for our strong value proposition. At the same time, Our VFR customers are increasingly adopting our broader product suite, supporting more stable yields across cycles. With this diversified demand profile, we continue to differentiate our network and selectively expand where fundamentals are attractive. Earlier this month, we announced 33 new routes that will start this summer, offering a balanced mix of domestic and international services from Guadalajara, including the US destinations of Detroit and Salt Lake City, as well as new operations from three strategically attractive secondary cities, Puebla, Querétaro, and San Luis Potosí. These markets have demonstrated solid demand growth in recent years, supported by rising income levels and meaningful state-level investment making them compelling opportunities for discipline network expansion and sustainable profitability. These launches build upon the success we have achieved in Guadalajara and Tijuana. As we explained on our October call, Guadalajara has become a strong market for multi-reason customers, representing roughly 20% of traffic in that market. and we are extending this proven playbook to new regions to support profitable growth. In parallel, we continue to optimize our slots and schedules, shifting certain flights to earlier times to better serve business and leisure travelers, improving customer experience and potential yields. The financial benefits of these adjustments are already beginning to materialize in our TRASM results. We are also expanding connectivity beyond our network. In recent months, we activated our co-chairs with Copa and Hainan, complementing our existing agreements with Frontier and Iberia and providing customers with broader global connectivity while enhancing revenue opportunities across our network. Revenues from co-share partners increased more than 30% in 2025 and many are still in the ramp up stage. For our international market, we observed an inflection point in the third quarter of 2025, which continued to materialize in the fourth quarter and as we start 2026. Our US routes are recovering nicely. We are planning to deploy roughly two thirds of our total capacity growth this year to the cross-border market, consistent with our broader international strategy, which now represents approximately 42% of our total capacity and supports a more diversified and resilient network. As we broaden our competitive positioning with new destinations, we are well positioned to capture cross-border demand as recovery continues. Booking trends so far in 2026 have been very healthy with momentum building into Semana Santa and the spring season. As we lap favorable comparisons in the first quarter of this year, the demand environment gives us confidence in sustained strong performance. Now, I will turn the call over to Jaime to cover our financial results and 2026 guidance.

Thank you, Holger. In the fourth quarter, we continue to act nimbly leaning into our variable cost structure to manage short-term headwinds. We also remain prudent and proactive with managing our capacity support demand and fleet availability trends. This diligence is reflected in our financial results for the quarter and the full year. For the fourth quarter of 2025, total operating revenues were $182 million, a 5.6% increase versus a comparable prior year quarter, This increase was driven by a substantial trust on recovery in the back half of the year, as Holger explained, pointing to continued diversification of our revenues and early strength of segmentation efforts. Our top line also benefited from a strengthened peso, which appreciated 8.7% versus the U.S. dollar, despite providing an incremental cost headwind. we continue to diminish the impact of X volatility on our business through increased core border flying and U.S. dollar denominated sales. On the cost side, calcium was $8.29, an increase of 3.2%, despite average economic fuel costs rising 5.5% to $2.65 per gallon. Calcium X fuel was $5.76, aligned with our guidance, and up just 1.4% year-over-year. For the fourth quarter and full year, we achieved Casomex field results in line with our planning, despite flying materially fewer than originally planned ASMs in both periods. Looking down our P&L, the impact from our grounded fleet and engine maintenance and our actions to manage the related interim capacity deficit is reflected in several lines. Our depreciation and amortization, right of use, and maintenance items continue to reflect costs of our total fleet, including grounded aircraft. Additionally, as we approach elevated aircraft lease returns scheduled for 2026, our aircraft and engine viable lease expense line continue to reflect with delivery accruals, including reserves for aircraft maintenance upon returns. Meanwhile, In the other operating income line, we book sale and leaseback gains of $10.4 million related to the Airbus deliveries of five new aircraft. This line also includes our aircraft rounding compensation from Pratt & Whitney. For the fourth quarter, we generated EBITDA of $328 million with a margin of 37.2% aligned with the guidance provided for the quarter. EBIT was $100 million for a margin of 11.3%. Finally, we generated a net profit of $4 million, translating into our earnings per ADS of $0.04. Moving briefly to our P&L for the full year 2025 compared to full year 2024, total operating revenues were $3 billion, a 3% decrease. Custom was $0.084, 0.1% increase with an average economic fuel cost of $2.59 per gallon, 6% lower. Gas and mix fuel was 5.58 cents, 3.5% higher than last year. EVITAR totaled $988 million, a 13% decrease with an EVITAR margin of 32.5%. $135 million, representing an EBIT margin of 4.4%. Over the next several years, we expect to meaningfully reduce the spread between EBITDA and EBIT margins as we reverse the impact of capacity reductions related to engine-related AOEs. Prior to these issues and the resulting roundings, the spread between EBITDA and EBIT margins hovered between 18% and 19% of revenues. but reached 28% in 2025. In 2026, we expect the CVTR-12 express to tighten to 24% and to return to historical levels in 2028. That loss was 104 million, or a loss of 91 cents per ADS. Turning now to cash flow and balance sheet data, for the fourth quarter, cash flow generated by operating activities was 252 million. The cash outflows provided by and used in investing and financing activities were $2 million and $280 million, respectively. CAPEX, excluding fleet pre-delivery payments, was $56 million for the fourth quarter and $251 million for the full year of 2025, in line with guidance. Volaris ended the quarter with a total liquidity position of $774 million, representing 25.5% of the last 12 months total operating revenues. We continue to target liquidity of at least 20% of the last 12 months revenues as part of a disciplined and conservative approach to cash management. At fourth quarter end, our net debt to EBITDA ratio stood at 3.1 times unchanged from the third quarter. We expect the leverage in the second half of the year supported by improving earnings and fleet productivity as AOG levels decline, finishing 2026 with a ratio of approximately 2.6 times. We continue to have no material near-term debt maturities and have already financed all pre-delivery payments for aircraft settled for delivery through mid-2028. We remain focused on our core financial priorities of cost control, profitability, and conservative cash management to preserve the strength and value of our business. Now, turning to our fleet plan and engine availability, as of December 31st, our fleet consisted of 155 aircraft with an average age of 6.6 years, with 66% of the fleet being fuel-efficient new models. During the fourth quarter, we averaged 36 aircraft on ground due to engine-related issues. As Enrique discussed, we are at the inflection point in aircraft on ground, which peaked at 41 aircraft in January. We expect a steady reduction from here on, with more meaningful improvement in the second half and towards year-end. We anticipate closing 2026 with approximately 25 AOGs. This trajectory implies a full year average of approximately 33 AOGs, representing three additional aircraft returning to service versus 2025. The reduction in AOGs is supported by concrete manufacturer actions, including durability upgrades to the hot section of the engine, expanded aero roads throughput across the global network, and the rollout of engagements and certifications. Together, these initiatives are extending time on wind and reducing shop turnaround times, such that the number of engines being induced into MROs and returning to service are expected to be consistently larger than those being removed. As we gradually narrow the gap between our total and productive fleet, while remaining disciplined in aligning capacity road with demand, we expect to unlock meaningful financial benefits particularly from the second half of the year onward. As grounded aircraft return to service, we will be able to generate the same growth and earnings from essentially the same massive base. Our fleet in absolute numbers of aircrafts will somewhat decline in the next couple of years, but the available of productive fleet will increase and close the gap between our total and available productive aircraft providing adequate ASM growth to meet our guidance without the need for incremental fleet-related debt for the remainder of the decade. This will improve the EBITDA to EBIT conversion and translate directly into a stronger free cash flow and return on invested capital. We have aligned our fleet plan to prioritize discipline growth in productive capacity rather than total fleet size. Looking ahead, Our base case assumes a broadly stable total fleet until 2030, with growth driven by the increasing share of productive aircraft. To preserve flexibility, we continue to actively manage the multiple levers we have, including managing leads approaching exploration and adjusting our order book. Even these moving parts, rather than viewing them in isolation, we recommend focusing on our guided ASM growth. which already incorporates aircraft deliveries, engine returns, and aircraft re-deliveries. Despite pending availability headwinds over the past 30 months, Polaris has consistently demonstrated a strong operational resilience. As fleet productivity improves, we are excited about the next phase of our growth as we evolve our network and products, maintain operational focus, and continue strengthening our already world-class cost structure and margin profile in the years ahead. Turning now to guidance, for full year 2026, we are expecting ASM growth of around 7% year-over-year, EBITDA margin of around 33%, and CAPEX net of finance lead pre-delivery payments of approximately $350 million. Double-clicking on these CAPEX, we expect higher major maintenance activity due to the number of aircraft scheduled for delivery, and a pull forward of major maintenance activities to support accelerated engine inductions into parts shops. It is important to note, we expect this strategy to also support a more stable maintenance profile in the years ahead. Our full year 2026 outlook assumes an average foreign exchange rate to be approximately 17.7 Mexican pesos per U.S. dollar. We also assume an average U.S. Gulf Coast jet fuel price to be in the range of 2.1 to 2.2 dollars per gallon. For the first quarter of 2026, we are targeting an ASM growth of approximately 3 percent year-over-year, TRASM of around 8.5 cents, Casomix fuel of approximately and an EBITDA margin of around 25%. As the AOG trend reverses, as I previously mentioned, we expect improved EBITDA to EBIT conversion to support a stronger underlying profitability. We therefore expect first quarter EBIT margin to remain broadly flat in line with our historical margin seasonality and implying a year-over-year improvement over the minus 1.5 percent mile reported in the first quarter of 2025. Our first quarter 2026 outlook assumes an average foreign exchange rate of around 17.5 Mexican pesos per US dollar and an average US Gulf Coast jet fuel price of approximately 2.2 dollars per gallon. consistent with the realized prices for January and February and the forward curve for March. Separately, the recent appreciation of the Mexican peso has created near-term translation effect as approximately 40% of our cost base is peso denominated. For reference, at the 17.5 pesos per dollar rate embedded in our guidance, FX translation alone will represent approximately a 0.4 cent impact on first quarter CASMX. On top of the expected peso appreciation, the CASMX fuel increase in our guidance is explained by non-recurring factors. First, as I just mentioned, to achieve our target reduction in AOGs throughout the year, we accelerated engine inductions to Pratt & Whitney shops, which increases maintenance expenses in the near term. Second, we are projecting secure one-time expenses related to the proposed merger with VIVA. Taken together, these non-recurring items account for approximately $0.22 in unit costs in the quarter. These fleet actions strengthen our operational trajectory and support margin expansions not only this year but over the medium term. We have clear visibility on our fleet normalization and remain firmly in control of our road and execution plans through 2026 and beyond. As the engine situation progressively moves behind us, we believe Volaris is centering a period where improved productivity, disciplined growth, and structural cost advantages position the company to generate meaningful long-term shareholder value. Now, I will turn the call back over to Enrique for closing remarks.

Thank you, Jaime. I'd like to conclude our remarks with a few takeaways. First and foremost, Volaris continues to demonstrate the strength and adaptability of our ultra low cost model and our command over our markets and cost structure. A highly flexible, low cost operating framework is especially well suited to an emerging market like Mexico, allowing us to manage unit costs effectively across any level of capacity growth. This operating discipline has enabled us to adapt quickly to changing macroeconomic and industry conditions, preserve affordability for our customers, and continue operating profitably through periods of disruption. Our experience demonstrates that in this market, a disciplined ultra-low cost carrier model is not only resilient, but a key driver of long-term value creation. Second, travel sentiment in the cross-border market continues to improve and we are well positioned as the recovery progresses. Our evolving segmentation strategy gives us greater ability to capture profitable demand while remaining disciplined in how we deploy capacity. Third, we remain committed to delivering low-cost, high-value service across our customer base including our core VFR segment. Our expanding product suite and network allow us to address diverse customer preferences while maximizing TRAS among higher-yielding segments. Fourth, we are not changing our DNA. Our proven low-cost, low-complexity development of ancillary and affinity offerings is enabling higher revenue per passenger and improved fare mix while preserving our cost efficiency, and long-term profitability. Finally, Volaris is advancing from a position of strength. As we narrow the gap between our available and total fleet, we expect meaningful financial tailwinds, including further improvement in our already world leading cost structure. Before opening the call to Q&A, I would like to briefly reiterate the strategic rationale behind the proposed transaction with Viva. As outlined in our announcement, we believe this transaction has the potential to create value for all stakeholders. In the case of the passengers, through affordable access to an expanded network. In the case of communities, through increased service and local economic development. In the case of our employees or ambassadors, through enhanced stability and job opportunities across new markets, and in the case of Mexico, through improved regional connectivity. Together, these benefits support the stronger and more inclusive future for ultra-low-cost air travel in Mexico. At this stage, there is nothing further we can share beyond what has already been disclosed. We will continue to provide updates as we progress through the process. As we move into the Q&A session, I kindly ask the questions focused on Volaris' operating and financial results. In Zoom, we believe Volaris is exceptionally well positioned to generate strong, sustainable value for our shareholders in 2026 and beyond. I'll now turn the call over for questions and answers.

Thank you. The floor is now open for questions. If you have a question, please dial star 11 on your phone at any time. If at any point your question has been answered or you wish to move yourself from the queue, you can do so by pressing star 11 again. Questions will be taken in the order received. Those following the presentation via the webcast may post their questions on the platform. Please hold while we poll for questions. Our first question comes from Michael Landenberg with Deutsche Bank. Your line is open.

Hi, good morning. This is Angelina Dahl. I'm from Mike. Thanks for taking my question. You reported a tax rate of 89% in the quarter. Could you help us understand the key drivers behind that? Thanks.

Hello, everyone. This is Jaime. When you talk about the tax rate, remember that during the first three quarters of the year, we use the legal tax rate of 30%. Then normally in the fourth quarter, we adjust to apply the actual tax rate of the year considering the numbers. So the full year effective tax rate for Volaris was 11.8%. Normally we will include the 30 over the first three quarters of the year. In the last one, we will apply the actual number of taxes that we are going to pay For modeling, we strongly recommend everyone to continue to use a 30% effective tax rate.

Got it. Thanks. Another question on the 7% capacity growth for 2026. How should we think about it in terms of the domestic versus international mix?

Hi, this is Holger. As we mentioned in our prepared remarks, first of all, I'd like to mention that our capacity decisions are firmly anchored on customer demand and on profitability. If we look at the breakdown that you're referring to, we plan an overall capacity growth of 7%, and that is consistent with an emerging market and an emerging customer base that we are observing in our customers. We are going to be more skewed towards the international market, and we're expecting domestic growth to be in the low to mid single digits for 2026 and then if you look at it on a quarterly basis in the first half asm growth will be relatively lower to the lower base in 2025 where we made tactical adjustments to capacity in 2025, given the cross-border environment at that time in 2025. The overall growth rate of 7%, we do have flexibility to move up and down within the range of a few percentage points as we move forward in the year and observe demand trends.

Okay, very clear. Thank you very much.

One moment for our next question. Our next question comes from Dwayne Fenworth with Evercore ISI. Your line is open.

Hi, this is Jacob for Dwayne. Thank you for taking my question. First question, just as you talk about the flat fleet count through 2030, could you perhaps talk about what that means for the multi-year capacity growth outlook and potential capex?

Hello, this is Jaime, Jake. In terms of capacity, think that we are going to be growing in that 7%, even in the mid-term over our five-year program, but with the availability to increasing capacity or lower capacity by two, three percentage points. So if you look at total number of aircrafts, the number that we finish in 2025 should be at the same level in 2030. And all of that growth is going to be coming from the unproductive fleet, putting them into production. We have the leverage that we mentioned in the call, which is aircraft re-deliveries during the period. We have a high number which provides flexibility, airborne deliveries, and that's what we'll be managing capacity, matching the capacity to the demand we observe in the market.

Great. And then can you just remind us on how many planes are being returned this year and what the associated re-delivery expenses?

We are returning 14 aircraft this year, Jake, and the increase in the CAPEX of the year is in connection to re-delivery of the planes, and in addition to that, in the investment that we are doing in major maintenance events to reduce the number of AOGs. The CAPEX that we are estimated for this year is It's around $350 million to accomplish that.

Okay. Thank you, Amir.

One moment for our next question. Our next question comes from Rafael Simonetti with UBS. Your line is open. Rafael, your line is open. You can ask your question.

Oh, thank you. Hello, Enrique. Hi. My name is Robert. Thanks for taking my question. My question is about leverage. So leverage went from 2.6 times to 3.1 from the fourth quarter of 24 to 25. And with higher complex ahead and only marginal margin improvement guidance, what's the path back towards the leveraging? And there's a leverage target that the board is working towards. Thanks.

Hi, Rafael. This is Jaime again. Do you think that the leverage is helping a sequential improvement towards the re-end? As I mentioned during the call, we expect the 3.1 that we started in the year to go to 2.6 times during the year. It's also going to be a result from the improvement in reductions of AOGs of the fleet. Thank you. Makes sense.

Excuse me. This concludes today's question and answer session. I would like to invite management to proceed with his closing remarks. Please go ahead, sir.

as well as our board of directors, investors, bankers, lessors, and suppliers for their support through a historic 2025. I look forward to demonstrating what Volaris can deliver in 2026 and beyond. Thank you very much for all your support.

This concludes the Volaris conference call for today. Thank you very much for your participation. Have a nice day.