Results 3Q17 November 8, 2017 #NOVAGOL 3Q17 Highlights Net - - PowerPoint PPT Presentation

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Results 3Q17 November 8, 2017 #NOVAGOL 3Q17 Highlights Net - - PowerPoint PPT Presentation

Nov 23, 2022 32 likes •246 views

Results 3Q17 November 8, 2017 #NOVAGOL 3Q17 Highlights Net operating revenues: R$2.7 billion Indicators 3Q17 Var. x 3Q16 (+13.2% vs. 3Q16) ASK (BN) 12.0 4.5% Operating result of R$327 million and Traffic (000) 8,303 2.2%

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Results – 3Q17

November 8, 2017

#NOVAGOL

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SLIDE 2

Indicators 3Q17

  • Var. x 3Q16

ASK (BN) 12.0 4.5% Traffic (000) 8,303 2.2% RPK (BN) 9.6 5.1% Load Factor 80.2% +0.4 p.p. Yield (R$ cents) 24.85 +8.6% Pax Revenue (R$ MM) 2,395 +14.1% RASK (R$ cents) 22.62 +8.3% CASK (R$ cents)1 19.90 +5.0%

2

3Q17 Highlights

 Net operating revenues: R$2.7 billion

(+13.2% vs. 3Q16)

 Operating result of R$327 million and

EBIT margin of 12.0%

 Net income: R$328 million and

margin of 12.1%

 EPS: R$0.94/share | US$1.49/ADS  Aircraft utilization: 12.3 block

hours/day (+7.4% vs. 3Q16)

 Net Debt2/LTM EBITDA: 3.4x

  • 1. Excluding non-recurring results 2. Excludes perpetual bonds (R$ 420.0 million)
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SLIDE 3

3

Capacity and Network Rationalization

Number of Operating Aircraft

(average)

Flights/Day

116 116 116 3Q16 2Q17 3Q17 11.5 12.0 10.4 4.5%

ASK (MM)

9.2 9.6 8.1 +5.1% 18.5%

RPK (MM)

3Q16 2Q17 3Q17 3Q16 2Q17 3Q17 680 694 637 2.0% 3Q16 2Q17 3Q17 15.0% 9.0%

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4

The Most Competitive Airline in Brazil

(1) Information published by companies for 2016 (stage-length adjusted). (2) Excludes perpetual bonds (R$ 420.0 million).

  • 1. Brazil’s lowest cost for 16 years:
  • Single fleet of 120 B-737 (120 MAX 8 orders)
  • MAX 8 is ~15% more fuel efficient (x 800 NG)
  • Lean and productive operations (best utilization)
  • Lowest fixed costs
  • Best-in-class maintenance
  • 2. Brazil’s best customer experience:
  • Most on-time service
  • Most comfort and leg room
  • Most convenient flight network for businesses
  • Wi-Fi & on-board entertainment
  • #1 loyalty program
  • 3. Brazil’s most profitable airline:
  • 9.3% operating (EBIT) margin (9M17)
  • 3.4x Net debt2/LTM EBITDA (3Q17)
  • Highest productivity: 288MM ASK/aircraft (9M17)
  • 4. Brazil’s market leader:
  • Leader in main airports (66% total domestic traffic)
  • Strong brand
  • Continuous innovation: #NOVAGOL
  • 36% market share (September/17)

21%

lower CASK1 than closest airline

9M17 Productivity & efficiency

1,558 PAX/employee; 2,257 ASK/employee

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SLIDE 5

Best Customer Experience

 Most on-time departures (95.4%) and best

flight completion (98.4%)

 Best flight network  Innovation (#NOVAGOL): selfie check-in  Premium lounge  Fleet with:

  • GOL Online: internet access and complete

entertainment platform

  • Ecological leather seats: more comfortable

and modern

5

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SLIDE 6

6

2017 Full Year Guidance Revision

(1) Fleet of 120 aircraft at the end of September 2017 (four of them are sub-leased to another airline). (2) After participation of minority interest in Smiles S.A. (3) Net Debt of R$4,492 MM, excluding perpetual bonds , and LTM EBITDA of R$1,268MM (as of September 30, 2017) Downside risks: Q4 fares, external shocks, or capacity growth

Indicator 2017 Previous 9M17 (actual) 2017 Revised Average operating fleet 115 1161 115 Variation in capacity vs. 2016 (ASK) 0% to -2%

  • 0.1%

+/- 0.5% Variation in capacity vs. 2016 (Seats)

  • 3% to -5%
  • 5.7%

+/- 2% Variation in volume of departures (vs. 2016)

  • 3% to -5%
  • 6.0%

+ /- 4% Average load factor 77% to 79% 79% +/- 79% Net Revenues (R$ billion) +/- R$10 R$7.6 +/- R$10.3 CASK-ex fuel (R$ cents) +/- 14 14.1 +/- 13.7 Aircraft Rent (R$ billion) +/- R$1 R$0.7 +/- R$1 EBITDA margin 12% to 14% 13% +/- 14% Operating (EBIT) margin 7% to 9% 8% +/- 9% Fully-diluted shares outstanding (million) 347.2 347.7 347.7 Earning per share – fully diluted2 R$0.38 to R$0.52 R$0.04 R$0.80 to R$0.90 Fully-diluted ADS outstanding (million) 69.4 69.5 69.5 Earning per ADS – fully diluted2 US$0.57 to US$0.78 US$0.06 US$1.25 to US$1.40 Net Debt / LTM EBITDA +/- 4.2x 3.4x3 +/- 3.4x

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7

Solid September Quarter

 Fifth consecutive quarter reporting positive operating profit  Reduction in net debt1 of R$523 million (R$4.3 billion in 3Q17) vs. 2Q17

17.0% recurring EBITDA margin and 12.0% recurring operating margin, up 3.7 p.p. and 2.9 p.p., respectively, above 3Q16 margins.

September Quarter 2017

Recurring operating (EBIT) margin 12.0% (up 2.9 p.p.) Ancillary revenue (cargo and other) and change q-o-q 11.9% of Total Rev. (down 0.7 p.p.) Passenger unit revenue (PRASK) change quarter over quarter Up 9.2% Fuel price (change q-o-q ) | Average exchange rate to US$ R$1.99 (up 1.7%) | R$3.16 CASK ex-fuel (excluding non-recurring expenses) change q-o-q Up 7.1% GOL System capacity (ASK) change quarter over quarter Up 4.5% GOL System capacity (Seats) change quarter over quarter Up 2.4%

  • 1. Excludes perpetual bonds (R$ 420.0 million)
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8

Load Factor and Forward Bookings

2015 2016

  • Chg. (pp)

Jan 83% 82%

  • 1

Feb 76% 76% Mar 74% 73%

  • 1

Apr 79% 76%

  • 3

May* 76% 75%

  • 1

Jun 76% 75%

  • 1

Jul 83% 83% Aug 76% 78% +2 Sep 76% 78% +2 Oct 75% 76% +1 Nov 73% 78% +5 Dec 77% 79% +2 2016 2017

  • Chg. (pp)

Jan 82% 83% +1 Feb 76% 78% +2 Mar 73% 76% +3 Apr 76% 79% +3 May 75% 77% +2 Jun 75% 78% +3 Jul 83% 82%

  • 1

Aug 78% 78% Sep 78% 80% +2 Oct 76% +4 Nov 78% +1 Dec 79% +2

(*) New network rolled out in May 2016

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9

Profitability (EBITDA) | 3Q16 vs 3Q17

20.9 22.6

3Q16 3Q17

RASK

(R$ cents)

319.8 463.2

3Q16 3Q17

EBITDA1

(R$ million)

3Q16 3Q17

CASK1

(R$ cents)

5.81 5.82 3Q16 3Q17

+0.2%

Fuel CASK1

17.0% 13.3%

EBITDA Margin1

19.9 19.0 +5.0%

CASK Ex-fuel1 +7.1%

(1) Recurring

+8.3%

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10

Net Financial Results

Financial Expense

(R$ MM)

Financial Income

(R$ MM)

 Net Financial Results:

  • 3Q17: income of R$29 MM
  • 3Q16: expense of R$101 MM

 Reduction of short and long-term

debt

(1) Exchange and monetary variations

261.8

3Q16 3Q17

362.7

3Q16 3Q17 242.21 33.4¹

297.2 268.5

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SLIDE 11

Net Income Composition (R$ MM)

Excluding minority interest

+317 (31) +37 +14 +278

(0.9) +328

(148) +202 (94) (64) 11

3Q17 EPS: R$0.94/share US$1.49/ADS

3Q16 Net income Net margin: -0.04% Net revenues Fuel costs Aircraft rent Maintenance materials and repairs Other

  • perating

expenses Net financial results (ex-FX) F/X Gains Deferred income tax Minority interest 3Q17 Net income Net margin: 12.1%

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12

Operating Cash Flow Generation

in R$ million

9M16 9M17 3Q16 3Q17

Operating cash flow 37.1 1,090.5 (5.2) 588.6 Investing cash flow 390.0 (454.8) (52.8) (201.0) Financing cash flow2 (1,577.9) (440.1) (241.1) (40.0) Net increase (decrease) in cash and cash equivalents (1,150.7) 195.6 (299.1) 347.6 Total liquidity1 1,829.11 2,118.1¹ 1,829.11 2,118.1¹

Operating Cash Flow Margin

(1) Consolidated cash, cash equivalents and account receivables beginning in 2016. (2) Includes foreign exchange variation on foreign subsidiaries.

0.5% 14.4%

  • 0.2%

21.7%

  • 5%

0% 5% 10% 15% 20% 25% 9M16 9M17 3Q16 3Q17

quarter year-to-date

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SLIDE 13

Liquidity and Leverage

13

(1) Cash, equivalents, short term investments, restricted cash and receivables (2) Includes operational deposits (maintenance / lease deposits)

2,589 2,574 2,759

26.3% 25.9% 26.9% 3Q16 2Q17 3Q17 Total Liquidity + Deposits Liquidity / LTM Net Revenues

Short Term Debt (R$ MM) Balance Sheet Liquidity1 (R$ MM) Interest Coverage (R$ MM)

2,099 2,028 2,102

1.0x 1.2x 1.3x 0.9x 1.5x 1.7x 3Q16 2Q17 3Q17

LTM EBITDAR LTM EBITDAR / Interest Exp.+Rent LTM EBITDA / Interest Exp.

743 728 586

2.5x 2.4x 3.6x 3Q16 2Q17 3Q17 Short Term Debt Liquidity / Short Term Debt

2

4,773 4,868 4,345

5.6x 4.2x 3.4x 3Q16 2Q17 3Q17 Net Debt (ex-Perp) Net Debt (Ex-Perp) / LTM EBITDA

2

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SLIDE 14

Historical 3Q16 4Q16 1Q17 2Q17 3Q17 Balance Sheet Items (R$ MM) Total Debt 6,346 6,379 6,091 6,217 5,921 Off Balance Debt (Minimum Payment Operating Leases) 6,454 6,247 5,791 5,579 5,133 Capitalized Leases (7 x Rent) 8,776 6,979 6,402 6,090 5,831 Adjusted Total Debt1 15,122 13,358 12,493 12,307 11,752 Adjusted Total Debt1 excluding Perpetuals 14,697 12,929 12,073 11,869 11,332 Total Liquidity2 1,829 1,922 1,517 1,771 2,118 Total Liquidity2 + Operational Deposits3 2,589 2,679 2,261 2,574 2,759 Net Debt Ex-perp4 4,773 4,789 4,976 4,868 4,345 Adjusted Net Debt ex-perp1,4 13,549 11,767 11,379 10,958 10,176 Leverage Adjusted Total Debt1 / Capitalization (Market Value) 87% 89% 81% 82% 72% Total Debt / Capitalization (Market Value) 75% 80% 68% 70% 56% Net Debt4 / LTM EBITDA 6.1x 4.6x 5.7x 4.6x 3.8x Net Debt excl-Perp4 / LTM EBITDA 5.6x 4.2x 5.2x 4.2x 3.4x Coverage LTM EBITDAR / Interest Expense + Rent 1.0x 1.2x 1.1x 1.2x 1.3x LTM EBITDA / Interest Expense 0.9x 1.5x 1.2x 1.5x 1.7x Liquidity Liquidity2 / LTM Net Revenue 19% 19% 15% 18% 21% Liquidity2 + Deposits3 / LTM Net Revenue 26% 27% 23% 26% 27%

(1) Adjusted total and net debt includes Capitalized Leases (7x Rent) (2) Liquidity includes cash, equivalents, short term investments, restricted cash and receivables (3) Including Maintenance and Lease Deposits (4) Includes cash, equivalents, short term investments and restricted cash

Coverage and Liquidity

14

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15

GOL Operating Fleet Plan

Aircraft Type Configuration 2016 2017 2018 2019 2020

Capacity: 138 pax Range: 5,570 km Type: 737-700

28 24 25 22 21

Capacity: 177 pax1 Range: 5,440 km Type: 737-800

93 91 91 89 86

Capacity: 186 pax Range: 6,510 km Type: 737-800 MAX

  • 52

13 21 TOTAL 121 115 121 124 128

(1) Reconfiguration in the first half 2018 to increase the number of seats by 5% to 186, maintaining Gol+Conforto spaces. (2) Sale lease-back announced on Sep 5th 2017 will increase the number of Boeing 737 MAX 8 aircraft planned for 2018 from five to six, without changing overall fleet plan of 121 aircraft at year-end 2018 (redelivery of 737-700 or 737-800 to be defined).

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Appendices – 3Q17

November 8, 2017

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17

GOL’s Outstanding Shares and ADSs

 To calculate EPS, divide net income by the weighted average shares outstanding

(ON/35+PN): 347.72 million

 1 ADS represents five (5) preferred shares (new ratio as of April 27, 2017).

To calculate Earnings per ADS, divide net income by 69.54 million ADS.

Shareholder Common Shares ON (%) Preferred Shares PN (%) Total %* Volluto 5,035,036,580 100.00% 68,915,078 33.81% 5,103,951,658 61.19% Delta Airlines

  • 32,926,025

16.15% 32,926,025 9.47% Other/Free Float 560 0.00% 101,739,019 49.91% 101,739,579 29.26% Treasury Shares

  • 278,612

0.14% 278,612 0.08% Total 5,035,037,140 100.00% 203,858,734 100.00% 5,238,895,874 100.00%

(*) The calculation considers the ratio of 35 common shares for each preferred share. Shareholding composition as of October 31, 2017

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18

Low Unit Costs | 2Q17 CASK

(USD cents, stage-length adjusted)

Source: Financial information published by companies (IR websites, SEC and CVM), converted by the exchange rate of each period. Variable Costs Fixed Costs Fuel Costs

LCC Benchmarks Latin American Companies

3.92 3.93 4.04 4.24 3.08 3.84 4.15 2.98 2.60 0.90 3.18 3.00 3.02 2.22 3.19 1.85 1.69 2.42 2.09 1.32 2.12 2.06 1.92 1.81 1.83 1.97 1.65 1.94 1.87 1.21

9.23 8.99 8.97 8.26 8.11 7.66 7.49 7.34 6.57 3.43

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19

2Q17 KPIs | Productivity

116 98 96 92 88 87 84 77 69 43 20.8% 11.5%

  • 6.1%

10.9% 13.0% 3,9% 14.1% 4.6% 1.0%

  • 2.0%
  • 45.0%
  • 35.0%
  • 25.0%
  • 15.0%
  • 5.0%

5.0% 15.0% 25.0% 35.0%

ASK (MM) / Average Number

  • f Operating

Aircraft & Net Margin (%)

LCC Benchmarks | Latin American Companies

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Disclaimer

This presentation may contain certain statements that express GOL Linhas Aéreas Inteligentes S.A. (“GOL”) management’s expectations, beliefs and assumptions about future events or results. Such statements are not historical fact, being based on currently available competitive, financial and economic data, and on current projections about the industries in which GOL operates. The verbs “anticipate”, “believe”, “estimate”, “expect”, “forecast”, “plan”, “predict”, “project”, “target” and other similar verbs are intended to identify these forward-looking statements, which involve risks and uncertainties that could cause actual results to differ materially from those projected in this presentation and do not guarantee any future GOL performance. The factors that might affect performance include, but are not limited to: (I) market acceptance of GOL services; (ii) volatility related to the Brazilian economy and financial and securities markets, and the highly competitive industries GOL operates in; (iii) changes in domestic and foreign legislation and taxation, and government policies related to the transportation markets; (iv) increasing competition from new entrants to the Brazilian markets; (v) ability to keep up with rapid changes in technological environment; (vi) ability to maintain an ongoing process for introducing competitive new products and services, while maintaining the competitiveness of existing ones; (vii) ability to attract customers in domestic and foreign jurisdictions. Other factors that could materially affect results can be found in GOL’s annual report

  • n Form 20-F as filed with the U.S. Securities and Exchange Commission, particularly under “Risk Factors” session.

All forward-looking statements in this presentation are based on information and data available as of the date they were made, and GOL undertakes no obligation to update them in light of new information or future development. 20

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Investor Relations ri@voegol.com.br +55 11 2128 4700 www.voegol.com.br/ir