Stronger than ever, with record results, Azul is ready to take off in 2025

Azul, the largest airline in terms of number of flights and destinations served in Brazil, maintained its route firmly in 2024, faced the turbulence in the sector and prepared itself financially to take off in 2025. In the month in which it completes 16 years of history of a unique business model in aviation, the company is already celebrating the results of this effort, during Azul Day, and remains confident about its plans for the future.

Challenges overcome

For CEO John Rodgerson, Azul has overcome several challenges throughout its history, but he emphasizes that the work of all Crew Members (as everyone who works at the company is called) made a difference in facing each one of them. Among those responsible for episodes in which the company had to rethink its route, to guarantee the direction of its business, the executive mentions the high dollar, the price of aviation fuel in Brazil, the crisis in the sector due to the lack of aircraft parts, in addition to the floods in Rio Grande do Sul that closed the Salgado Filho airport in Porto Alegre for almost six months – responsible for 10% of the country's air network.

“Our expertise, ease of adaptation, support and trust from more than 15,000 Crew Members, in addition to our partners and investors, was what helped us maintain our differentials, even in the face of difficulties, and guarantee the best experience for our Customers”, pointed out John.

Credibility to move forward

Azul's resilience throughout its history reinforces the confidence of partners and investors in the company. This motivated them to carry out a transaction that is vital to the process of strengthening the company's balance sheet and cash flow for the future.

Azul has renegotiated its obligations with more than 95% of its aircraft lessors and original equipment manufacturers (OEMs), totaling approximately US$850 million in agreements. This results in a significant reduction of its debt by more than US$550 million, aiming to improve its cash flow by US$100 million annually over the next three years.

The company announced an additional debt reduction of over US$800 million to its bondholders, impacting cash flow by US$100 million annually due to the reduction in interest payments. This agreement with the bondholders will also result in the injection of US$500 million of new capital into the company.

“With the respect we have gained in the market as one of the only airlines in the world to work directly and amicably with its stakeholders to position itself for the future, I am confident that we will take off and maintain our pace of expansion, offering the best return to our investors and partners,” predicts the executive.

Blue Future

All this work, which will make the company ready to take off in 2025, is already yielding results. In the third quarter of 2024, Azul achieved three historical records: EBITDA of R$1.7 billion, with a margin of 32%; operating profit of R$1.0 billion, with a margin of 20%; and total revenue of R$5.1 billion, an increase of 4.3% compared to 3Q23 and an impressive growth of 23% compared to 2Q24. Compared to 3Q19, total revenue increased by 69%.

Even before the end of 2024, the company is already recording figures that show a 6% year-on-year increase in supply, reaching R$6 billion in EBITDA, another feat never achieved by the company. By the end of 2025, the airline will receive 12 to 15 new aircraft, most of which are Embraer's new-generation E2 195 models, which provide a competitive edge in terms of the network and operational efficiency for the company when compared to its competitors. In addition to these aircraft, two new A321-F freighters will begin operating in the first quarter of next year.

Going further, Azul strengthened its business units, which now represent more than 22% of revenue. The Azul Fidelidade program ended the quarter with more than 18 million members in 3Q24, with a 63% year-over-year growth in gross revenue.

Azul Viagens, the company's tourism operator, grew 42% in gross bookings compared to 3Q23 and represented more than 6% of total ASKs in 3Q24. Azul Cargo remains strong, with revenue growing quarter on quarter, and with a considerable recovery in international markets where revenue increased 23% year on year. Azul TecOps, the newest business unit, generates additional efficiency to the company's maintenance organization and accumulates contracts with several Clients, generating total efficiencies for Azul of around R$500 million since its foundation.

“We have a unique business model, with structural competitive advantages, business units that generate high margins and grow significantly, and a fleet transformation that positions us to drive growth in the Brazilian aviation market.

Therefore, we will generate R$7.4 billion in EBITDA in 2025. This competitive advantage also puts us in a position to face any future challenge. All of this is only possible because we have more than 15,000 Crew Members who delight our Customers on every flight, in addition to partners and investors who believe in our future”, concludes John. 
 

Source: Azul.