AZUL - Earnings call transcript Q2 2021

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Operator

Hello, everyone, and welcome to Azul's Second Quarter 2021 Results Conference Call. My name is Simone and I'll be your operator for today. This event is being recorded and all participants will be in a listen-only mode until we conduct the question-and-answer session following the company’s presentation. [Operator Instructions]. I would like to turn the presentation over to Thais Haberli, Investor Relations Manager. proceed. Please

Thais Haberli

slides will and that Malfitani, Azul's the we Q&A this and IR Alex are Azul's Founder Simone Rodgerson, call. CFO; quarter audio all are also Revenue call, session. Officer, and Abhi here David and website. results reference The be Neeleman, announced the and the welcome you, our Chairman; second to Presenting earnings John of available Chief for Thank today on we'll our that this CEO. Shah, morning, our

to statements. Before like are non-IFRS will be filings. and particularly I and isolation. a on today I uncertainties turn risks are our that Any David, Company's performance during CVM With turn over David. the considered call, the assumptions These Also, will David? of facts, Company call range forward-looking but the the objectives believes discussed discussed regarding our should comments to over forward-looking statements SEC that, not detail the to to I'd plans, measures, of are that which matters historical we reasonable, expected future in regarding based subject in in caution not call that the are are performance you course and statements. constitute discuss

David Neeleman

everyone, joining Thanks, us earnings for and for Hello, thank you XXXX Thais. our second call. quarter

crisis we're our position the as of as to the emerge thanking essential efforts, in amazing our navigated of passion our for have by culture this to to always pandemic. First challenges of I and start the Thanks successfully from have all, team members, this their stronger. we strong the been people company

flying have our on Slide competitive this We're than are year. to open and many we you cities, ever. XXX advantages As see to stronger more X, can already

an incredible our which our on strength, done network, is Our rebuilding in focused job connectivity. has team

to ability allowed us levels, we more gives to in recover flexibility fleet that we incredible routes capacity XX% has of why still This the carrier our us one the which are else is only to can. demand unique than access Our the no serve. XXXX

is the effect. recovers, in to in This model and synergistic. we revenue network, profitability destinations very business improves it's unsurpassed our of Our as entire And map. the can demand terms add network

is and focus to leads on opportunities and markets Lilium our once founding. to Our with unprecedented an sub-regional huge have the commitments electric XXX% recently I'm Also, partnership types talk business. partnership our suited our Azul we way future social with see The X, market innovative the excited aviation helps where Brazil; in doubled Lilium. created and about new know economic regional the Brazil accelerate jet ideally through of us for network developments and by now model. leveraging ESG to We Brazil. Lilium the expand announced flying us Slide airplane that create again the the this in we And to since in

of this available the single vaccine there moment, not amazing this it's Speaking I more why the doses for year. million That have country newsflow doses share three million a of vaccine, the external X every XXX That's know Slide on than been the made. applied are XXX has is XXX of always out important of total in progress Brazil, positive. are the of doses to is million, population Brazilian. At

customers and are reopening economy returning have of least removed. back and down dose are businesses, office. have deaths the in corporate our Brazil will one the thankfully in case on other at The all restrictions weeks, to is received vaccine. rapidly. restaurants been are places counts Thankfully, the daily addition, and safely, In coming upcoming adults Schools in-person public

that see in levels I amongst vaccinate gives the Vaccines U.S. now as opened and availability the seeing of especially same together X, them. the has to know what with intent and of to the anyone all critically seen throughout with economy gives the the booming the demand Johnson is Slide the has this so The efficient sufficient are Brazilians, This deal vaccine. Brazil is plenty tools us Brazil important, the high to variants. vaccinate confidence to highest doesn't the Everyone the confidence being Pfizer, intent & intent solution up personally who we're get and new currently impact travel application in in AstraZeneca, than and applied Brazil, world. of CoronaVac want to variants. vaccine the the the has the country. country now approved different one we don't has more the Johnson further Moving as of are combination phenomenon Brazil. in

the the show turn vaccines Yes, second are John will our to trends John. are you, the But very to the and second the coming As that With advantage, thanks months. time about impacted revenue encouraging. I'll quarter. we're emerging and wave excited over stronger competitive

John Rodgerson

you, to exited quarter. for we Thank during the I to thank Thanks them, hard the also quarter our second David. members work their crew want all stronger.

continue on liquidity June, the our our now billion As compared in more the Operating business second PRASK world. with to At and R$X.X XXXX. history had recovery billion revenues X, can. excited attention prepared the show of the our logistics the our business. you and demand end for sustainable billion, really details our X% ahead quarter second access and our PRASK is slide. opportunities competitive further results about highest I resilient more that XX.X% advantage rational share in totaled will an in first capacity put We're upcoming best that to increased in along XXXX, of and was of airline else X.X% great position position confident a our a of quarter can of Cargo Slide respectively, also than network ourselves cash quarter. being we've the to we're the evidence total R$X.X nobody quarter compared an impressive the with our to RASK future. at another record Azul we're increasing R$X.X see to to turn

can operating you Slide by to cash million. we on This network. Azul's R$XXX shows see surpassed operating rebuild how market to over our X, capacity outflows responsibly put flows As

Our drives and Azul was airline the in of these June, issue In the network results. Latin first advantage directly since to only start the debt COVID unsecured pandemic. America

you to debt in significant when capital how future started We progress Azul made have markets see we Slide our the prudent it already are did. could have and open reducing deaths raise Starting and COVID in our again. X, was to to investing that

footing. XX, Azul support to On X.XXX% the years, at exit On recognized put next markets was our has with repayments debt The advances a no could the capital our cash capacity us us the Slide together yield. on carefully to Our to in allowing two see timing the billion here from the XX, position offer in the continue significant over over to raise enabling efforts preparing X.X Slide times debt you crisis with future. inflows recovery. we're recovery Azul for year the Brazil. raise on us focus to vaccinations last R$X operations in The solid will the oversubscribed Azul

a strategically is And to David our always we'll As profitably network so our done. as to continue and destinations part have recovery key do explained, adding of we strategy.

our our roughly year, short-term the clearly with us As overestimate and to the any under continue. early The in spotted of deliberate as unit higher in demonstrating first compared to made and leisure the Slide our second as trend focus this the The also plan that capacity network to our we on fuel decision quarter milestone vaccine XX XX, environment strong significant now led profitably ability is. is trends second travel we year. is fare adjusted seasonally currently XX% we will fare focus swift important gives months. increases. recover increased the our can XXXX, the the yielding This XXXX. demonstrated We the say on industry that our through is is most is on Slide in gives to are average increase confidence scenario prepare same We fares half the the XX, cannot revenues. compatible that domestic decision high rest of key recovery I PRASK the strong focus continue than FX. sequential revenue up for time This corporate off, this This period in post-vaccination. rebound last and this how a the paying and for both and essentially recovery.

revenue. net slide. in Moving of another record to terms the Cargo next Azul had quarter

second business Our to compared grew the quarter of logistics XXX% XXXX.

and reliable flexible X,XXX cities as today XX largest with Cargo to the as the in than impressive can to more all fleet The Brazil of cities able that, Just combination domestic together most deliver fast under Azul Brazil. in unmatched is provide passenger network hours. to X,XXX service over

cargo Slide higher update new with a company. quarter gross since more are of be to redemptions We XX, from making our program Customer pandemic. program. ex-Azul very you and X high on company with engagement loyalty a the levels. pivot to added the XXXX logistics was start has we continued during of TudoAzul members than strong than to the the wanted billings million already On

particular program club revenue TudoAzul well. performed in recurring has at very Our

the members drive In to addition, quarter. been joining customer CobraNet more the market best each loyalty in has with card airline us further supporting

customer make the best sure world. lead like disclosed to the commitment industry I'd and measured MAC Now We in service metrics July. as our to in the focus consumerdoor.gov by by on we airline remain

now we aircraft. XX region on As Wi-Fi Slide XX, can fastest are the on already you of offering see installed our the in

to more clear for at welcome free. in fly sponsoring the try Campinas Azul and this it the Hangar We of of amazing efficient. we're corporate how product. example being customers which have customers is allows to a Even We our making our all us offer better product, to installed you Wi-Fi

of to to most fleet. four to skies an anniversary. will to amazing the our the more fleet Walt aircraft supply of cannot Moving with Walt World complete first in total Disney will XX, expand have unique excited world. this into magical I customized with XXth like to Brazilian this magic the the have magical The World Slide soon Disney relationship be be and proud celebrate arrival aircraft Disney. brand In themed We're the

Moving XXXX, the Azul the Slide you airline like that would on TripAdvisor rated remind I in world. to best to in XX,

We have missions. our internally expanded

Aviation than Wrapping we it's remain Slide cost employment local expectation supported and broader we development transportation other airline is lives, want air development, our to of in with all the aircraft emerging airline it XXXX destination isolated previously delivered EBITDA people. market. quarter Each with of serves in among routes an component and providing of best organs sole Azul XX% also opportunities more communities trade more time of onboard reliable, is food, that efficient helping to XX the country, key stronger destinations actions these a you is XXX people, XX vaccines benefits. up of In Now saving the important transported different world. to the faster sustainable region tourism a a than Azul we surpass and on essential millions year bringing XXXX. air an be other in a Safe, Azul many strategy closer of tons new were that and Brazil. to for in XXX distributed providing our XXX than important communities. XX, more together. emerging businesses mobility best a driver remind service effective will and the our our to and million connects is Brazil throughout over We an position second Azul contributes stimulating of development the

and above We EBITDA forecasting transformation. focus make that have progress. world a fleet one as as to levers some We're as will I of with now to the our But strategic bumps happen. be XXXX. a the quickly powerful and only to continues the continue feel to transform It we for we forward, our currency discipline confident road vaccines a fleet in possible challenging. Yes, ahead target as look us again fuel responsibility. on have prices and we XXXX remain airlines that unique in

put return David, will here we to a to office half take second it. As With any reopens a of of of Abhi so vaccinations questions. revenue strong ourselves full the can continue the and to hard to position are and that corporations in answer year. progress, the Alex, advantage I your economy We've environment we see during worked

Operator

and Ladies thank you. gentlemen,

Instructions]. [Operator now will question-and-answer session. We begin the

question with Bank. first Our Deutsche comes Hillary Cacanando from

Hillary Cacanando

Hi, for thanks. And Mike. I'm calling in

for really dose at by XXX% of taking vaccine. thanks of It's my So impressive question. without Brazilians doubt September that COVID least of end one have

the to mean by Brazil expect year in corporations seeing the visa you your get this so office what of to you next I the employees segment full your are you. your back? mandating corporate business? guess get -- wanted or I their of is fall? So back maybe early do if to And view recovery Thank

John Rodgerson

we're now Yes, offices our seeing up. filling --

throughout open. Companies traffic all the in Rodizio Paulo are are on. in, think São Restaurants Paulo, back is I São online. so back coming

will corporate companies hearing most customers. by the September. end our And think be I of office we're all that from the in

And in terms to that's how trending of so demand. I'll let talk Abhi revenue

Abhi Shah

Yes. Hi, Hillary.

So from August hearing very good to that and coming yes, into sign. are second back for the months definitely is they the corporate we're obviously which dose as office, our customers a comes September of the that play

weeks, people has especially recovery and of revenue a So XX%, our especially latest will doses. lot the of around month, get this last in which nice is been couple the recovery corporate second a right now data

are leading because recovery. how And leading that parts terms we Brazil to we're is leading, the I country. is business exposed country and countries our diversified the as of as well, corporate So around think a different in Azul already network, many of of

So of things. kinds not pharma, just its all its infrastructure, finance, Agro, its those it's energy,

seeing XXX% we're for we corporate so XXX%. a and engineering already is some example, with construction already for XX% over over then at And example. segments But a finance have of

our are still And where the booking recovery different of country, that, we XXXX. fares already than but XX%. exposed at So, even higher parts to with we're is

fares going that to actually as want even recovery So higher. push it's progresses, to the

Hillary Cacanando

Okay.

back so in to guess volume. I of expect in of to XXXX? -- you of like Do relative probably -- terms guess when terms terms we great. in getting I But So and be that's

Abhi Shah

can have we end now think see to by at XX% going I'm right XX%, the so I Yes, the well at expecting year. be next to of over we're steady being us at year. We'll of the see But XX%. up ahead. improvement where months. we're end the couple easily XX%, I

John Rodgerson

thing million I mentioned population had David think of that I've XXX also want people. million to XXX a highlight for over one doses

the availability yet CoronaVac. so, many have got vaccines that the to several not. Brazil countries vaccine, have And Johnson shots has they Pfizer there to ability the are apply so & world where the do and other got do mix the booster and Johnson individuals But in vaccine, the others AstraZeneca, that

Hillary Cacanando

strong booking fares far out And Got a then going third to it. into And Okay. now? think the leisure as also follow-up booking quarter. you customers do how remain the corporate average on

Abhi Shah

leisure in and as actually Leisure like are has up fares while fares compared are corporate up. around so XXXX, compared average fares corporate are XX% to Leisure fares world. up Yes, actually Brazil in both more leisure up, led XX% XXXX. are over recovery the the to elsewhere

And local nonstop, tend they as comes call further, is more a leading. as in, that curve customer fare has. bit leisure the confidence rebalance moving in as come comes or more booking the again, in. The to fly corporate tend -- But little it book higher. closer the more also and to back pushes good, the which So will and slowly, they because shows is corporate as that out closer is more we it which traveler

kind movements. will And of is back, confidence planning as and But One so move as better two the increase spring customers you about curve well. feeling corporate summer. ahead, the in comes have

And XXXX. back, in compared was shift on average, would say I still out start in to as where it to will it comes corporate it's further So the again.

Operator

comes Savi Raymond with next from Our question James. Syth

Savi Syth

good afternoon. Hey,

this just terms the maybe at but you plan, and thinking is outlook. what's industry the I some Just assuming expectations of what a generally and the of Azul that demand capacity XXXX. expectations, was about on -- you're of high-level kind outlined, macro realized wondering and as of XXXX recovery, kind what underscoring both I curious I'm in the EBITDA

Abhi Shah

be Hey Savi, largely capacity, of fleet in terms the to Yes. going unchanged. is

this so increasing And year, a also be going is capacity coming up right. the utilization. of just of in to ramp it full-year it's lot And

the in reductions of sort second quarter the of because have we So second wave.

the it. in recovering of we're Now process

average at we for recovery today. the actually if John we've to months. held as actually XXX% But about held about we've fly talked wanted next have few fares, the more -- actually We could we

average So actually it's a that the the that and coinciding could we lot can have of with I vaccines, better of we're confidence average fares going gives time than catch-up to give fares out expected in and worked seeing us forward. terms

So current it's just that going to our be the we year November/December, fleet capacity have in and coming round. just

growth. no where There's growth incremental So the be that's that's the other going from. to -- comes

can as normal it you period. coming that ramp up of sort a for full-year as today, having our utilizations, So we to fleet think opposed a just have of

Savi Syth

your industry an bankruptcy. and the of accelerating That's their another then and And on through helpful, you've side, working order one fleet do still aircraft transformation, Abhi. seen competitors competitor

you what think curious industry Just in would look XXXX? like the capacity

Abhi Shah

Yes. listening. I they're obviously mean,

will and And decision the up, what said, industry returning late but how revenue, market numbers very been June, fares and not we average doing we to we're fly July, we And think we you been today. unit prepare knowing very we're that average higher demand. ourselves we time vaccination at look, is -- pick the we could right. that I the what we So and the aggressive we've catch-up saw giving giving as need again, demand I want in said, it. with say do, in I And fair, has made to average to fares to and if more I've I we're very, least like encouraged recovered wanted with for

to similar for And worked I for think so good everybody. it's and And seeing that really think I we something because I And that's us out the followed. what has that well we're industry seeing, made. the decision it they're that hope

to it's going I be disciplined. overall, So think

year, or anybody a attacking I like also don't else. anybody think that see things they want to everybody I like that. good have

think going I plans, to be to their and disciplined we. are within want they're as

is August, for our And September. everybody revenue made has to And nice So think overall. now for think in us. well out improvement. I the a in focus really already seeing fares I the recovery that average worked we force sequential We're decision

John Rodgerson

in And seen in map. significantly Savi, is I been in were added Guarulhos. you've Abhi has to And you've just and want capacity add, what [indiscernible] like this Recife also has down do Campinas actually and to us the where then put cities more places

demand that accessing So of you actually pre-pandemic. online have those weren't even pockets

cities the served so there on was, more hubs a strength. And is more because much we focused and our than network being different it is little where have

Operator

with next McKenzie from Our question Dan comes Seaport Global.

Dan McKenzie

thanks Hi, here. out I story of one upgauging current the trends just for departures perhaps are off, to can questions or than down guys. flush that And a first Yes, proxy different couple seen next ASKs departures, guess today part year? I've relative are reasonable versus ASKs you housecleaning that XXXX story the story, ASKs. very of

Abhi Shah

is happening what's mean, efficient. exactly I what happen. wanted we The Dan, Yes. airlines more becoming to

combination We as before and We departure average costs have we ASKs. size, well. before stage less have those you're have didn't more length didn't we aircraft have and generating have rate AXXX. those You It's XXs. of a

used So you'll mile see if trips don't we have U.S. and Europe, actually the stage we right it's up, like you X,XXX to. notice overall to though our length to even

up actually recovering then stage So unit significantly. is our And unit domestic even we're revenue. racks, length quite

of yes, down departures you So XXXX generation. side. -- see it is that in ASK what the proxy I and strength XXXX more we're domestic seeing in what see you a But speaks further on will what think

Dan McKenzie

see. I

or at forward get about Okay. use you The with about profile have how position I agreement, to cash LatAM guess share going a are capital a you thinking the on today And two position potential cash potential conversations what kind the you to Yes, you execute to you can this about to if airlines merger how today, your relative can thinking the point? plans, today? the reach consolidation. growth are sufficient where an of that is relative and that

John Rodgerson

current of then I'll And let Alex about kind I'll talk answer consolidation cash. Dan, the our Hey question.

Alex Malfitani

Yes.

times it's our do, time. cash, with that through we And we going on we paying Dan, got right. we saying had consistent get of to from that's partners year. support that current hey to to we're proud we've last what committed the what were everybody So tough the over back been And

year everyone. multiple pay have paying years This it's suppliers. We to mainly we're year, back where a

back. XXX% forward, debt of will credit look which targeting we'll our all them start or mature can we of going XXXX going that are and going down, guided the billion end to on we have in need capital. of pay like it decide, But we We're debt at the year We're all of we we at start XXXX, just right. the in year renegotiated generation, we'll to we at But support paying of pay and which should should that we still the we're a of cash strategically principal paying new look with that own pay cost to the the some down the start the above R$X a quarter XXXX, to XXXX. Next we to debt access, back be two for for of pay lot and to our lessor our flow debt multiple time. back right. was to roll roll to to banks, which ago. a internal not instruments sources going We capital, paying and that then but can going we years that forward, We're that have

so. that we -- of we in the that to deleveraging to can some to we future the cash for pay So to fly whenever fleet position use so intentional, we we the so ready decide to of that pay is raised capital its right a that XXX% capacity do it have have and invest

John Rodgerson

we're where about full whether in do and it's in are negotiation I their strategy, market. exclusivity as confident pilots, specific best benefits of believe Brazil creditors, domestic that say synergies the consolidation or will that not of including an suppliers, OEMs. they talk but commercial their in very their that has benefits all period consolidation it TAM is it's because am Well consolidation going benefits we very on, to integration our we Dan, the that going and it the airports, especially benefit it have stakeholders of healthy, benefits entire process will I the industry large I too -- But everybody, speak. Yes, interest strongly it own

on yes, think we excited given haven’t so, it. and do favorable up environment it. still to very about at that We're And looking We're opportunities it's a we exist regulatory the so.

Alex Malfitani

as so there's And Yes. market value creation or much said, commercial much any it so in synergies, right. strategic John kind easily of financeable, be transaction it's that

cash, it's not of a if any transactions be materialize for these the So to required will one problem.

John Rodgerson

to had inbound largest several world from the funds transaction. the We've the calls finance in some of wanting

the of the we'll market there's to nothing So time. update update at but at appropriate this time, kind

Operator

[Operator Instructions].

Raymond Savi question James. from next comes Our with

Savi Syth

for Hey, here. the follow-up thanks

to XXXX? Just kind given into kind you more of curious, mentioned of on restructuring costs we'll deliveries fair in of and a of was cost the net a better that XXXX that that Is the year to is more net angle see than I improvement the you bit therefore to before you've slash are kind done that in non-field retirements far. little kind it the get that can utilization tied updating of assume unit suites the so and next and kind of just and suites

John Rodgerson

what heck the doing of kind Brazil. Alex you let I'll still lot still are right. people Savi. say, yes, but a the cost, unit here, I that's we're address of why in mean, Yes,

already than EXs meet much on XX XX and we because, that fuels XX coming years. XX% did AXXXneo, Every incremental you You've burns do. it's an less EXs. I'm And where as XX the here XX, take got been EXs time seats burn they have seats. fuel more here

of Azul flying AXXXneos, fast it's does what seen like, promising. the very as nine we're so XX look EXs what of you having having the of we've and kind And forward, around

Certainly, the can ASK certainly So increase is airline level lower and of place. taking with of more the production organization we re-fleeting actually much because a our departures efficient that's improve. costs unit

about our that think is in that's so competition on years that gets are -- so front. of several business. I we excited And what And front us that this

Alex Malfitani

I'm the saying to to year, again. to we fleet if have stay optionality is flat the going Alex forward, but right. so, essentially we choose It's deliveries next for asset advance do

And that the so appropriate at we decision time. will make

if worst manual case, aircraft date, we do slightly to we down choose expiration advance of lease reached the to next I as so. we but flat delivery their think stay to have ability is generation

cost going On I to side, down that is dramatically knows the think from today, are cost everybody the unit unit come they right. where

operational there's leverage. First

Now ASKs generate they essentially costs with fixed right. lot a in of have we capacity already our not back, up already in that are lot structure that we will can network A go place. the as the P&L bring and more the we

already airline you, So cash that we and operational we to leverage right, are. more committed is We that And we COVID we than going then efficient reduce were. to post significantly. also reaffirmed commitment that will a be

airport you And processed XX% customers airport the Just right. to per idea member today compared pushing crew more an we're that number XXXX. we level, up, at give already to

to an even push further have it internal goal We up.

even be more And so we will efficient.

processes Some company, but of is be the and a of we're a airline. lot area more technology, of of lot in it is it to a efficient it every committing upgauging, is

control fares for that in is up, up. assumption to you your costs increases cost have down be when have mid-single-digits, where NFX everybody So our industry the for wherever fuel fact the that is that and to is today that you because give everybody we costs a should on you different get bottom because through from XXXX, will able for to we the right, NFX fuel But FX to fares pushes be fuel for somewhere leave for recapture if will pressures. fuel you the assumption I think levels, in Then fuel confidence will facing Then NFX, above they that line end NFX if assumption right. fuel control XXXX, XXXX be. everybody, has NFX, unit

certainly the can yes, so pushing us they're unit And us a in more as But rationality continue capacity up being terms committed will if discipline airline allow we fares count you. you of and cost, to post-COVID, efficient the required. to on

John Rodgerson

was One big you fleet, the of things of to one what going on the things the EX. are with do

of homes to And we'll aircraft found ability the to obvious, end dedicated increases six end by renegotiate significantly. those many get so And cargo know, lower year, much as as and on average the rate EX. already at EXs lease cargo the for of lease you as our eight flying a have flying as

the even what we've home inside starting is they're kind So happens good of airline now a found to be with to assets. and tension those

right about position our feel And fleet good so now. we very

Savi Syth

it making helpful. And out, is like is how the several Lilium network? which feels serving of it the easier with flights? network? that just, does areas zoo lifetime Jet, Or or those within fit kind That's within I you a is right Okay. for they did to fit this Is now, a but the years like aircrafts people today how it to -- get it serve realized

Abhi Shah

it's Abhi. Yes,

connecting is for right. subs large So it Paulo, take or Lilium you're the not hour Jet. we've -- São notional connecting run, as -- a network it's airport made you're And drive now the flight, will some different more two-and-a-half XX drive really a minute like two-hour suburbs, a think metroplexes about it's a

downtown Uber type service, it's and Uber, that's between areas. So Black something not XXX it's between suburbs, destinations, kilometers about between an beach really residential

about would connecting takes two now over of different of minutes. because metroplex traffic, distance, of a XX large that normally and you sort you because And take hours, points within

So much classic inter with mobility, than travel it rather is mile which XX urban trip. aligned is your intercity suburban more

John Rodgerson

the right. get we you, destinations Savi, Paraty nice they're average those. caravans But today, like we on Hangar great fly And to right? and to I fly And fares want we aircraft, and to Buzios remind and

the has cost. aircraft Lilium so And much with lower Jet XX

no it, when so we And for was us. it a looked brand at

Operator

Dan comes Global. from question next Seaport Our McKenzie with

Dan McKenzie

Well, could hey, here. want time to longer-term? today? of where for profile And following-up Azul years question. say Alex, is maturity three but just XX really leverage look you for road? what see Thanks sort the everybody the do the end profile, year see leverage again, prior like my ultimately on next and of I down Slide What

Alex Malfitani

need airline with young balance you threes that "debt" the have adjust right. of generates to pandemic. fleet, now an high older that Yes, the a young was we so thing because XX prior we IFRS more to and than a for were Sure. an with sheet fleet in the part fleet, One number on

even saying that. But of to we're going adjusting, threes of get started where the pandemic. that's the we've We you're high what to kind do, right. you kind adjust have So was for threes, without were shooting and to low to

and then you you five quickly see going to and a get project should fairly three. converges financials, soon converges out year, to As we're next it to essentially quickly that that four, handle our to

maturities that short-term, have we debt it's three you we we target. out. of manageable, the two, have a Especially, couple don't very years until to in But because So, lot that's a pointed get something right. as

investors get we to can that We're until focus to we saying, get investors start see. A or three. our going on before what we reinvest we're we get to it use Once were going much cash. cash, going we're that too back a of lot to going business. de-lever. to those about, Until you the got and keep We're talked were we'll all that's So shares? to on, lot cash when of hey, you having then buying the We're of to threes, dividends leverage all starts levels to to going conversations I us that a something to pushing are paying start with it going that into of pandemic. maybe keep

Dan McKenzie

good. Very

into here second cargo help just you on just the guess wondering more elaborate how the to a we about bit just trajectory and I that three then where operation. year, growth little And next want head should I'm part Okay. of can you plan. are where today, next think a also and your on year, as question of you into if we of it end head kind year be over

Abhi Shah

Dan. hey Yes,

the double So we last road about from air. business really lot do great on is call to in talked is We're on And to well the logistics we're from migrating this XXXX. that. seeing customers XXXX earnings to strength track going a I to think

so And that's driving.

stealing grow the We're competitors. share really our from aren't We helping market.

sustainable to growth I I well. so going as year And think going be next forward. growth mean, there's strong that's

significantly John our the will talked ones would help dedicated connect which about, We as and that fleet well. freighter have

growth XX%, again momentum I XX% -- this have year. next we as XX%, should into So next year, continues

John Rodgerson

R$XXX from perspective, there of XXXX, is million revenue obviously in XX%, in we this a that have XX%. Dan. cargo put that's year, to billion Just another

just R$X.X XXXX, in R$XXX billion, had let's get we that's out revenue say it's So that million more top-line cargo we of right. than

clearly profitable is years, in the than stop as doesn't to made investment And dedication the that's business growth made the had into it's our continue we a a last in into business. more as will and logistics we the growth us XXXX, XXXX, in a certainly that get helping further off XXXX we over the invest and investment paying that's we XXXX XXXX, So two in now. team, the

Dan McKenzie

countries. very is well could of in bit I the to that sneak of final beginning just the you Brazil international here, vaccine And conversation have how that here? Yes, business one side is this potentially with have I idea just you then other a Europe can about little And and Abhi, if if talk waking a good. see passport, you, a one up

Abhi Shah

Canada, Yes, cases, terms those down on hospitalizations, borders. well, I think is know terms we in U.S., in about high UK, mean, Dan. forecast of the that with bit Brazil in significantly And with still open Mexico, death. slow, here of U.S., coming especially forces the I and mean, in to is the think that list the as I Europe, the it's numbers pressure little of I terms

places requirement. up I do know some even travelers. the the about to So like started has now with that U.S. Greece, know about countries We open we Spain, with the like vaccine think UK France like that,

building. I momentum So think is

probably important different I I building. for so not. dealing So I possible, aren't weeks it's customers And momentum aligned countries. think think it's different as be away that regulations these with that think is much for as to rules But of sort

going take demand, the We'll of towards going momentum year. build think the end think not significant add when would weeks we'll not probably, But months back I they regulations I to momentum the no building. about doubt up, would pent-up kind We're is for There say maybe it's away, say sense, anything. building. force it. continue service. or open of international. two make there's I two to one to I So is And away. one it as comes it But and or is the

Operator

concludes sir. session. Instructions]. John to closing ahead, like and proceed Please question-and-answer statements. Ladies [Operator this I go today's to invite with would his gentlemen,

John Rodgerson

they've and Azul all for a work time Hello to in we day you especially their to everybody. and great feel look to team talking out Abhi, free that have Thais the for forward of thanks everybody and put all thank to myself, reach or you, Alex

Azul (AZUL) 12 Aug 212021 Q2 Earnings call transcript