Brazilian airlines’ revenue drops 53% in the 1st quarter of the year

The decline in demand, due to Covid-19, influenced the financial result of the companies. According to the statistical data submitted to ANAC for the first quarter of 2021, the main Brazilian airlines – Latam, Gol and Azul continue to maintain reduced levels of flight offers compared to the same period in 2020, with reductions of 40.5%, 34.5% and 1.0% for each month respectively.

During this period, there were increases in the industry’s most significant cost-related indicators compared to the same period in 2020. The price of fuel (QAV) increased 2.2% and the dollar was 22.8% higher.

Air service revenues were down 53.5% compared to Q1 2020, while operating costs and expenses were down 33.8%. Ticket revenue fell 57.6% and accounted for 76% of total air service revenue. Cargo and mailbag revenues, meanwhile, increased 6.1% and represented 10.8% of the total. Among costs and expenses, fuel represented 25.7% of the total, once again becoming the sector's highest cost. The second largest cost was personnel, with 18.8% of the total.

In the first quarter of 2021, the sector’s net result was R$ -6 billion, with a net margin of -119.2%. In the same period last year, the result was R$ -9.6 billion, with a net margin of -90.9%. Worsening were also noticed in the gross margin and EBIT margin, which were, respectively, -17.4% and -35.4% in 2021 against 10.3% and 1% in 2020.

The information is available in the Data and Statistics section of ANAC’s portal (available only in Portuguese)

Methodology for Financial Statements

In compliance with Resolution N. 342/2014, Brazilian public air transport companies with relevant market share must submit their financial statements to ANAC. Quarterly financial statements must be submitted by companies with a share equal to or greater than 1% in terms of domestic or international revenue passenger kilometers (RPK). The annual financial statements must be submitted by companies with a participation equal to or greater than 1% of the domestic or international RPK or revenue ton kilometers transported (RTK).