The Brazilian airline Azul had a net loss of BRL 2.94 billion in the second-quarter, pressured by the effects of the Covid-19 pandemic in the aviation sector. The net loss excluding the exchange rate and unrealized hedges totaled BRL 1.5 billion. A year earlier, the company had a profit of BRL 351.6 million.
According to the company, its operating revenue in this second quarter was BRL 402 million, down 85% year over year due to a severe reduction in air
travel demand caused by the pandemic.
Azul’s operating expenses decreased 46% or BRL 1.0 billion year over year, mainly driven by lower capacity-related expenses and cost reduction initiatives, said the company, that had an operating loss of BRL 820 million excluding non-recurring items.
During the quarter, Azul said it successfully executed its Management Plan generating over BRL 7 billion in cash savings between March 2020 and December 2021: immediate liquidity including cash and equivalents, short-term investments and accounts receivables was BRL 2.3 billion, beating the company’s forecast of BRL 2.0 billion and increasing its cash position quarter over quarter. Total liquidity was BRL 6.6 billion, including long-term investments, unencumbered assets, maintenance reserves and deposits.
Azul said that the Management Plan was implemented to confront the crisis and optimize the airline for the future, engaging all of its stakeholders including crew members, lessors, aircraft manufacturers, suppliers, and
the Brazilian government.
“When we originally created our plan, we conservatively assumed demand would recover to approximately 40% of pre-COVID levels by the end of 2020; demand has recovered faster than expected, and we now project to be at 60% by year-end”, it says.