Financial and Operating Highlights
▪ In 4Q22, operating revenue reached once again an all-time record, as travel demand remained strong. Total operating revenue reached R$4.5 billion in 4Q22, 36.9% above 4Q19 and 19.4% higher than 4Q21. In 2022, operating revenue totaled R$15.9 billion, up 39.4% versus 2019 and 59.9% above 2021.
▪ PRASK and RASK were also at record levels, up 10.0% and 8.2% respectively compared to 4Q21, even with a 4.8% growth in passenger traffic over a capacity increase of 10.3% year over year. Compared to 4Q19, PRASK and RASK were up 23.6% and 27.2% respectively.
▪ Yield also reached an all-time record of R$50.6 cents, an increase of 15.8% compared to 4Q21 and up 32.0% versus 4Q19.
▪ EBITDA was R$1,097.7 million in the quarter, representing a margin of 24.6%. EBITDA was up 6.9% compared to 4Q21. Compared to 4Q19, even with a 115.8% increase in fuel prices, 27.7% devaluation of the Brazilian real and more than 20% inflation in Brazil over the past three years, EBITDA was only 10.7% lower. Operating income was R$524.7 million in the quarter, representing a margin of 11.8%.
▪ CASK in 4Q22 was 37.68 cents, up 11.1% compared to 4Q21, mainly due to the 42.5% increase in fuel prices. CASK ex-fuel reduced 3.9% versus 4Q21, driven by our fleet transformation, cost reduction initiatives, productivity gains and capacity increase. Compared to 4Q19, CASK ex-fuel converted to dollars dropped 4.2%.
▪ Fuel consumption per ASK dropped 3.7% in the same period versus 4Q21 and 8.2% compared to 4Q19, as a result of the higher number of fuel-efficient aircraft in-service. Payroll efficiency measured in salaries per ASK remained flat year over year, even with a 7.9% increase in salaries as a result of collective bargaining agreements with labor unions, applicable to all airlines in Brazil.
▪ Immediate liquidity was R$2.5 billion. In the quarter, operational cash inflows surpassed outflows by over R$1.1 billion, and we continued our deleveraging process with over R$1.4 billion in current and deferred lease payments and debt amortizations, resulting in a reduction of R$408.3 million in immediate liquidity compared to 4Q19.
▪ Gross debt decreased R$1.2 billion in the year to R$21.8 billion. Excluding the impact of the new aircraft entering in the fleet, gross debt would be reduced by R$3.0 billion in 2022. Azul’s adjusted net debt to EBITDA leverage ratio decreased an impressive 5.5x from 11.2x to 5.7x, and in line with our guidance to end 2022 with leverage below 6x.
▪ Azul was the world’s most on-time airline in 2022, with an on-time arrival rate of 88.9% according to Cirium.
