SAO PAULO (Reuters) – Brazilian airline Azul SA said on Monday that its fourth-quarter adjusted net loss deepened on a yearly basis, but it expects bluer skies ahead thanks to a fresh deal with aircraft lessors to reduce payments.
Azul said in a securities filing that the agreement should allow its cash flow to be positive in 2024 and beyond, while also projecting a “measurable reduction” in capital expenditure in the period.
The carrier had revealed the deal late on Sunday, saying lessors responsible for 90% of its obligations had agreed to receive equity and tradeable debt in exchange for lower payments.
“We are encouraged by the strong demand environment and important milestones in our route network” in 2023, Chief Executive John Rodgerson said in a statement, noting the company has added routes to Paris and Curacao and is set to increase flights to the United States.
Azul expects to generate record revenue of 20 billion reais ($3.84 billion) this year and record earnings before interest, taxes, depreciation, and amortization (EBITDA) of more than 5 billion reais, roughly 40% above 2019 pre-pandemic levels, Rodgerson said.
In the fourth quarter, the company reported an adjusted net loss of 610.5 million reais, deeper than the 436 million-real loss seen a year earlier and also larger than the 562.81 million forecast by analysts polled by Refinitiv.
Total operating revenue rose 19.4% to 4.45 billion reais in the period, slightly below analysts’ forecasts, while EBITDA roughly matched expectations at 1.1 billion, up 6.9%.
($1 = 5.2017 reais)
(Reporting by Gabriel Araujo and Alberto Alerigi Jr.; Editing by Jon Boyle and Sharon Singleton)
