CPA

• General Business Resilience

  • Q2 2026 results demonstrate the resilience of COPPA's business model even in a sharply elevated fuel price environment, with 40% of Q2 bookings sold prior to the fuel price increase.
  • After years of aircraft delivery delays slowing growth, 2026 capacity additions allow the firm to further consolidate its Hub of the Americas advantage amid strong broad-based passenger demand across its network.
  • The company maintains a structurally low unit cost, industry-leading operational reliability, and one of the strongest balance sheets in the global airline industry, which management frames as key competitive advantages.

• Commercial Highlights

  • July 2026 preliminary traffic data showed a nearly 90% load factor (one of the firm's highest ever) on 16% year-over-year capacity growth, in a higher yield environment, confirming ongoing strong demand.
  • The firm recently announced a new destination: Por La Mar in Isla Margarita, Venezuela, launching in November 2026, bringing the network to 88 destinations across 32 countries in the Americas, further strengthening hub leadership.
  • Load factor was modestly pressured by the 2026 World Cup, which reduced June 2026 load factor by 2.3 percentage points year-over-year and cut Q2 RASM by approximately 0.1 cents.

• Operational Highlights

  • COPPA delivered industry-leading operational reliability in Q2: 90.6% on-time performance and a 99.8% flight completion factor, positioning it among the top global airlines for reliability.
  • The firm became the first airline in Latin America to launch high-speed Starlink onboard internet, with the first Starlink-equipped flight operating in July 2026; full fleet rollout is expected to be completed in the first half of 2027.

• Fleet & Strategic Hub Development

  • COPPA took delivery of four Boeing 737 MAX 8 aircraft in Q2 2026, ending the quarter with a total fleet of 131 aircraft; one additional 737 MAX 8 delivery is expected for the full year 2026.
  • The firm maintains significant fleet planning flexibility via delivery options, lease expirations, and a large base of unencumbered aircraft, allowing it to adjust growth pace based on market conditions.
  • Management announced a planned transition from 6 to 8 connecting banks at the Panama hub starting March 2027, which will improve network connectivity, increase aircraft utilization, optimize airport infrastructure use, and strengthen Panama's position as the leading intra-Americas travel hub.

• Balance Sheet & Shareholder Returns

  • Ended Q2 with $1.5 billion in cash, short-term, and long-term investments, equal to 39% of the trailing 12 months' revenue.
  • Total debt (including lease liabilities) was $2.7 billion (all for aircraft financing), with an average cost of debt of 3.7% and a net debt to EBITDA ratio of 0.9x.
  • The Board of Directors ratified a third quarterly dividend of $1.71 per share, payable September 15 to shareholders of record as of August 31, 2026.

• Full year 2026 operating margin is now guided to a range of 17% to 19%, with capacity growth guided between 14% to 15% (an upward revision from prior guidance, driven by earlier-than-expected Boeing aircraft deliveries and higher aircraft utilization, with strong demand supporting the faster growth pace).
• The updated 2026 guidance assumes an average load factor of 87%, full year RASM of 12 cents, ex-fuel CASM of 5.7 cents, and an average all-in fuel price of $3.60 per gallon.
• Management expects RASM growth of approximately 10% year-over-year in the second half of 2026, with broadly consistent performance across Q3 and Q4.
• 2026 full year capital expenditure is now guided to $700 million to $750 million, a $50 million downward revision from prior guidance, driven by one aircraft delivery shifting from December 2026 to January 2027.
• As of the call, 75% of Q3 2026 bookings are completed, and 25% of Q4 2026 bookings are completed, with booking trends remaining strong.
• For 2027, COPPA expects 12 gross Boeing 737 MAX deliveries, with two older 700 aircraft retiring for a net addition of 10 aircraft; deliveries will be evenly spaced throughout the year. The firm has not yet released full 2027 guidance.

COPPA Holdings is an airline business with a single operating segment focused on intra-Americas travel through its Hub of the Americas in Panama. For Q2 2026, the firm reported total operating revenues of $1.1 billion, representing a 25.7% year-over-year increase. Operating profit was $91.7 million, with an operating margin of 8.7% (down from 21.7% in Q2 2025). Net profit totaled $68.2 million, equal to $1.67 per diluted share, with a net margin of 6.4%. Passenger yields grew 8.7% year-over-year, while RASM (unit revenue) increased 7.9% to 11.6 cents. Capacity (measured in ASMs) grew 16.5% year-over-year, and load factor came in at 86.7% (down 0.6 percentage points from Q2 2025). Ex-fuel unit cost (CASM) remained flat year-over-year at 5.7 cents; including fuel, CASM increased 26% to 10.6 cents driven by an 85% year-over-year rise in average all-in jet fuel prices (from $2.32 to $4.28 per gallon).

• Elevated and volatile jet fuel prices relative to prior year levels represent a key near-term risk, with 40% of Q2 2026 bookings sold before the latest fuel price increase, limiting the firm's ability to pass through higher costs in the quarter.
  • Uncertainty around future aircraft delivery timelines from Boeing remains, after multi-year delivery delays that slowed COPPA's growth in prior years.
  • Competitive pricing risk exists as fuel prices decline from current elevated levels; management notes that industry pricing discipline has been strong amid high fuel prices, but it is unclear how competition will behave as fuel costs fall.
  • Forward-looking statements are inherently subject to uncertainties that could cause actual results to differ materially from current projections, including unforeseen shifts in demand, changes to input costs, and infrastructure constraints.

Q: An analyst asked how much of Q3 and Q4 2026 are currently booked, and what flexibility COPPA has for 2028 aircraft deliveries. / A: Management confirmed that ~75% of Q3 2026 and ~25% of Q4 2026 are currently booked. For 2027, COPPA will take 12 gross deliveries and retire 2 older aircraft for a net gain of 10 jets. For 2028, the firm expects higher delivery volumes as Boeing works through prior delays, but COPPA has 11 aircraft eligible for retirement via lease expirations plus more than 40 unencumbered aircraft, giving significant flexibility to adjust growth based on demand. Full 2028 delivery plans will be released by the end of 2026.

Q: An analyst asked why COPPA upwardly revised 2026 capacity guidance, and requested details on Starlink costs and business model. / A: The upward capacity revision stemmed from Boeing delivering aircraft earlier than originally expected, plus higher aircraft utilization that generates extra ASMs, with strong demand justifying the faster growth. Starlink capex was prepaid and already included in prior guidance, so it does not change 2026 spending plans. Complimentary access will be offered to business class passengers, top-tier loyalty members, and Starlink subscribers; other passengers will pay for the service.

Q: An analyst asked why Q2 2026 operating margins landed at the lower end of the prior guided 8-12% range, and what key factors drove the outcome. / A: Management noted that the wide guidance range reflected high uncertainty around fuel prices and demand response following the sharp fuel increase earlier in the year. Unit costs and fuel prices came in largely in line with guidance; the main driver of the lower-than-midpoint result was lower-than-expected RASM, driven primarily by a larger-than-anticipated negative impact from the 2026 World Cup on June travel patterns.

Q: An analyst asked how much of 2026's capacity growth comes from different sources, and when the next new destination will be announced. / A: Around half of 2026 capacity growth is a full-year annualization of growth implemented in 2025, ~10% comes from new destinations, and the remainder comes from additional frequencies on existing routes. Management confirmed that an 89th destination will be announced before the end of August 2026, for a December 2026 launch.

Q: An analyst asked about the sustainability of recent yield increases after fuel prices decline, and which regions are driving current strong demand. / A: Management reported that demand strength is broad-based across the entire network, with Brazil and North America performing slightly better on margin, but all regions are healthy. The firm notes that average regional yields were still below 2019 levels (before adjusting for inflation) even prior to the recent fuel price increase, so most of the yield increase is expected to be sustained even if fuel prices decline, leaving a net positive impact on profitability.