GOL Airlines First Quarter Net Profit Declines Due to Rising Costs

Brazilian no-frills airline GOL’s profit declined in the first quarter due to an increase in costs in the period. GOL reported a first-quarter net profit of 23.9 million Brazilian reals ($13.3 million), down from BRL61.4 million a year earlier.

“The reduction was due to the average 3.5 percent appreciation of the US Dollar against the Brazilian Real, which generated exchange variation expenses on foreign-currency-denominated liabilities, and the recognition of income tax and social contribution on net income as a result of taxable income during the quarter,” GOL said in a statement.

The company ended the quarter with a net debt of BRL1.74 billion, down from BRL2.94 billion in the year-ago period. Operational costs totaled BRL1.54 billion in the first quarter, up from BRL1.4 billion last year.

Net revenue rose 14 percent to BRL1.73 billion in the first quarter. The company said its earnings before interest, taxes, depreciation, amortization and aircraft rental costs, or EBITDAR, totaled BRL405 million in the period, up from BRL359.3 million.

The EBITDAR margin was 23.4 percent in the first quarter, compared with 23.7 percent last year. Figures were compiled using international financial reporting standards, or IFRS, accounting criteria.