On February 22, Gol Linhas Aereas Inteligentes (GOL) reported its financial results for the fourth quarter and the fiscal year 2010. Net income in the quarter was R$132.2 million (US$77.8 million), down 66.8% year over year but up 20.2% sequentially.

The decline was attributable to higher operating costs and expenses in the quarter and income taxes compared with tax benefits in the year-ago quarter. In the fiscal year 2010, net income plummeted 76% year over year to R$214.2 million (US$122.4 million).

Gol Linhas reported earnings of 29 cents per ADS for the quarter, a penny ahead of the Zacks Consensus Estimate. In the fiscal 2010, earnings came in at 46 cents per ADS, substantially down from the Zacks Consensus Estimate of 56 cents.

During the fourth quarter, net revenue was R$1,869.8 million (US$1,100 million), up 15.6% year over year and 4.5% sequentially. The improvement in revenue emanated from increased demand from the domestic and international markets, which pushed up the top line. The results, however, lagged behind the Zacks Consensus Estimate of US$1,833 million. 

In the fiscal year 2010, net revenues were R$6,979.4 million (US$3,988.2 million), up 15.8% year over year.

Operating costs and expenses based on revenues in the quarter plunged by 660 basis points to 86% from 92.6% in the fourth quarter of 2009. Operating income was R$261.9 million (US$154.1 million) with a margin of 14.0% compared with $119.2 million (US$68.1 million) with a margin of 7.4% in the prior-year period.

The company reported an EBITDAR of R$475.0 million (US$279.4 million) with a margin of 25.4% compared with R$290.1 million (US$165.8 million) and a margin of 17.9% recorded in the fourth quarter of 2009.

Exiting the fourth quarter, GOL Linhas’ cash and cash equivalents increased 68.6% sequentially to approximately R$1,955.9 million (US$1,171.2 million). The company recorded a 3.9% sequential increase in long-term debt position, which approximated R$3,395.1 million (US$2,033 million).

GOL Linhas closed the quarter with an operational fleet of 114 aircraft and a total fleet of 125 aircraft, with an average age of 6.8 years. During the quarter, the company took delivery of two Boeing 737-800NG SFPs, replacing one Boeing 737-300 and two Boeing 737-800s.

 
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