2. Disclaimer
The information ("Confidential Information") contained in this presentation is confidential and is provided by Controladora
Vuela Compañía de Aviación, S.A.B. de C.V., (d/b/a Volaris, the "Company") confidentially to you solely for your reference
and may not be retransmitted or distributed to any other persons for any purpose whatsoever. The Confidential Information
i bj t t h is subject to change without notice, its accuracy is not guaranteed, it has not been independently verified and it may not
contain all material information concerning the Company. The Company, nor any of their respective directors makes any
representation or warranty (express or implied) regarding, or assumes any responsibility or liability for, the accuracy or
completeness of, or any errors or omissions in, any information or opinions contained herein. None of the Company or any
of their respective directors, officers, employees, stockholders or affiliates nor any other person accepts any liability (in
negligence, or otherwise) whatsoever for any loss howsoever arising from any use of this presentation or its contents or
otherwise arising in connection therewith. No reliance may be placed for any purposes whatsoever on the information set
forth in this presentation or on its completeness.
This presentation does not constitute or form part of any offer or invitation for sale or subscription of or solicitation or
invitation of any offer to buy or subscribe for any securities, nor shall it or any part of it form the basis of or be relied on in
connection with any contract or commitment whatsoever. Recipients of this presentation are not to construe the contents of
this presentation as legal, tax or investment advice and should consult their own advisers in this regard.
This presentation contains statements that constitute forward-looking statements which involve risks and uncertainties.
These statements include descriptions regarding the intent, belief or current expectations of the Company or its officers with
respect to the consolidated results of operations and financial condition, and future events and plans of the Company. These
statements can be recognized by the use of words such as "expects," "plans," "will," "estimates," "projects," or words of
similar meaning. Such forward-looking statements are not guarantees of future performance and actual results may differ
significantly from those in the forward-looking statements as a result of various factors and assumptions. You are cautioned
not to place undue reliance on these forward looking statements, which are based on the current view of the management of
the Company on future events. The Company does not undertake to revise forward-looking statements to reflect future
events or circumstances.
2
3. Third quarter 2014 highlights and recent developments
Focused on international growth and domestic capacity discipline:
3Q14 Domestic ASMs 3% growth only, resulting in yield stabilization,
while international ASMs, same period, growth 18%, responding to
stronger fare environment
Unit revenue improvement: 3Q14 TRASM increased 1% y-o-y, with
stable yield and non-ticket revenues expansion
Non-ticket revenues growth: 3Q14 Non-ticket revenues ex-cargo per
passenger increased 58% y-o-y (44% including cargo). Ramp-up of new
products and services, while increasing customer acceptance
Cost control: 3Q14 CASM (1) at USD 8.9 cents, lowest unit cost
producer in the Americas
Strong balance sheet and liquidity: Cash of 14% of LTM revenues and
net debt negative (or net cash position) of Ps.922 billion, well funded for
future growth
3
Notes:
(1) Figure calculated at an average exchange rate corresponding for the period, $13.1114
4. Volaris – Mexico’s largest Ultra-Low-Cost Carrier
Lowest unit cost carrier in the Americas(1)
2008 2013 CAGR
U it t
Volaris’ destinations
Portland
Sacramento
San Francisco/Oakland
Fresno
Los Angeles
San Jose
San Diego
Las Vegas
Ontario LTM Int. Pax
Me icali
Chicago/Midway/O’Hare
Denver
Unit cost
(CASM ex-fuel;
cents, USD)(2)
5.5 5.5 0.0%
Passenger
demand 3.2 9.0 +23.0%
Ph i
Revenue 27%
Reno
g
Tijuana
Mexicali
Ciudad Juárez
Hermosillo Orlando
Chihuahua
Monterrey
Los Mochis
(RPMs, bn)
Aircraft
(End of Period) 21 44 +15.9%
Passengers
%
Phoenix
Ciudad Obregón
San Antonio
LTM Dom. Pax
Revenue73%
Fort Lauderdale (Miami)
Cancún
La Paz
Los Cabos
Culiacán
Mérida
Tampico
Puebla
Toluca
Tepic
Zacatecas
Mazatlán
Guadalajara
Aguascalientes
Puerto Vallarta
U
Colima
Morelia
León
Querétaro
Cd. de México/D.F.
(mm)(3) 3.5 8.9 +20.5%
Operating revenue
(mm, USD)(2) 397 1,018 +20.7%
Adj San Luis Potosí
Veracruz Villahermosa
Tuxtla Gutiérrez
Uruapan
Acapulco
Oaxaca
Adj. EBITDAR
(mm. USD)(2) 67 220 +26.8%
Adj. ROIC (pre-tax)
11.0% 15.1% +4.1pp Domestic market share (4)
Tapachula
Huatulco
12 2%
20.7% 22.7% 23.5%
Notes:
(1) Based on CASM among the publicly-traded airlines
(2) Converted to USD at average annual exchange rate
(3) Corresponds to the number of booked passengers
(4) Based on number of passengers
Source: Company data, SCT-DGAC
4
12.2%
2008 2012 2013 Aug YTD
2014
5. Volaris’ low base fares stimulate demand and drive
continuing growth
Since its launch, Volaris has stimulated new demand in the Mexican market through an aggressive
revenue management strategy that drives lower fares and higher load factors
Stimulation
of
demand
Lower base
fares
Resilient ULCC business
model driving high,
fi bl h
More
ancillary
revenue
Lower cost profitable growth
More capacity
5
6. Volaris’ ULCC business model is clearly differentiated from legacies,
hybrids and other LCCs
Aeromexico Interjet VivaAerobus Volaris
CASM 3Q14 ?
(cents, USD)(1) 14.0 14.2 - 8.9
Low ticket prices 3Q14 ≈
Average Fare (USD)(1) 171.8 104.5 - 94.1
Non-ticket rev. exc. Cargo 3Q14
Non-ticket rev. exc. Cargo per pax (USD)(1) 4.9 4.1 - 19.9
Modern Fleet ≈
Average age fleet (years) 9.8 (2) 6.0 (2) 20.6 (2) 4.3
High daily utilization
Block hours per day 13.6(3) 9.1(3) 9.9(3) 12.5
Other/ eg. (No GDS) ≈
Legacy <Hybrid/LCC < ULCC
Notes;
(1) Figures converted to USD at an average exchange rate corresponding for the period $13.1114
(2) Figures updated as per DGAC report as of June 2014
(3) Estimated information as of August 2014. Narrow body aircraft only.
Source: Company data, data airlines public information, DGAC reports, MI DIIO
6
7. Volaris has a best-in-class unit cost structure
Lowest unit cost in the Americas(1)
CASM and CASM ex-fuel (September YTD 2014, USD cents)(3)
1 4 15.1
10 6
15.4
13.9 13.6
10.7
13.3
5.3
4 8
4.5
10.0
10.6
8.9
3.5
4.8
5.6 4.7
4.1 4.5 4.0
5.4
10.1
9.1
8.0 8.5
6.6 6.0 6.0
10.6
LatAm (4) Aeromexico Gol (4) Interjet Copa (4) Allegiant Spirit DCOMPS
Denotes fuel
cost per ASM
Latin American Carriers US Network
Carriers(2) Best-In-Class
US LCCs
p S
7
Notes:
(1) Based on CASM among the publicly-traded airlines
(2) DCOMPS= Direct Competitors: Average CASM and CASM ex-fuel; US network carriers include: Delta, United, Alaska Airlines, American Airlines
(3) Non-USD data converted to USD at an average exchange rate corresponding for the period, $13.1167
(4) Figures calculated as of June YTD 2014
Source: Company data, Airlines public information
8. Focus on fleet utilization and efficiency drives higher
revenue and lower cost
Load factor
(Sept YTD 2014)
Implied passengers
High density configuration(3)
Volaris A320 per aircraft(1)
174 seats per aircraft
82%
80%
143
128
p
Aeromexico 737-800
160 seats per aircraft
Interjet A320
Aeromexico
Interjet 72% 108
Young, fuel efficient fleet (3)
150 seats per aircraft
High daily utilization(3)
Block hours per day (September YTD 2014) (2) Average age (Yrs, September YTD 2014)
10.3
9.4
6.0
12.4 11.8
8.7 8.8 8.1
4.3
(4) (4) (4) (4) (4)
Aeromexico Interjet Global Mexican Aeromexico Interjet
A320
Global
A319
Notes:
(1) Implied passengers per aircraft is calculated as available seats per aircraft multiplied by the load factor
(2) Block hours per day calculated as ((Total block hours for the period / Monthly average number of aircraft) / Number of days for the period)
(3) Aeromexico and Interjet represent domestic competitors of Volaris
(4) Block hours and fleet average age updated as per DGAC report as of June 2014
Source: Company data, airlines public information, DGAC, Airbus, miDiio
8
average
9. Bus passenger shift to air travel
Significant upside for air travel Air travel time and cost savings
Total air travel trips Mexico City – Tijuana
Travel time ( Hrs) Fare ( USD)(2,3)
(mm)
Total bus trips
(mm)
) )
145
40.5
36 5 h l 24% t i
2,781
36.5 hours less cost savings
110
2,706
4.0
60
30
75
Bus Air Bus (1)
• Mexico is almost three times the size of the state of Texas
• The distance between Tijuana and Cancún is similar to the
distance between New York City and San Francisco
30
2013
International
Domestic
2013
Executive & luxury
First, economy
and Notes:
(1) Executive and luxury class
(2) Fare figures calculated with average prices for September 2014
(3) Non-USD data converted to USD at an average exchange rate corresponding for the period for convenience purposes only
Source: Company data, Secretaría de Comunicaciones y Transportes (SCT)
y
9
other
10. Unbundled strategy: “Tú decides” – You decide
Pre-flight(1) Flight
planning
At the
airport
Onboard
aircraft Post-flight
• Excess
baggage
• Checked
bag • V-Club
subscription
(94k active
suscriptions)
• Advertising
• Food and
beverage
• Hotel
rooms
• Car rentals
• Seat
assignment
• Change /
booking limited
to 1 piece
(25kgs.)
• Carry-on
(oversized)
• Co-branded
credit cards
(80k active
cardholders)
• Airport
shuttle
fees
• Insurance
• Packages
Additional • Strollers
• Priority
boarding
• Manage my
booking
• VEmpresa
•forms
of payment
• Check-in
Notes:
(1) V-Club & Co-branded credit cards figures as of September 30th,2014 10
11. Acceleration of Volaris’ non-ticket revenues
Increased contribution of non-ticket revenue to the top line
2009 – 2013 CAGR: +57.6%
enue
1)
148
181
(USD mm)(1
Non-ticket reve
24 39
68
115
2009 2010 2011 2012 2013 LTM Sep 14
Non-ticket revenue per passenger
B ti l USLCC
Contribution
to Operating
Revenue
7% 7% 9% 13% 14% 18%
Volaris (USD)(1)
Best-in class US LCCs
(3Q14, USD)
2009 – 2013 CAGR: +24.0% 45
54
All i t S i it
7.0 8.9 11.4
15.5 16.5 19.0
2009 2010 2011 2012 2013 LTM S 14
Notes:
(1) Non-USD data converted to the corresponding average period exchange rate , for convenience purposes only
Source: Company data, Airlines public information
11
Sep Allegiant Spirit
12. Attractive growth opportunities in Mexico and
throughout the Americas
99
Domestic – growth potential of nearly 160
routes (4)
International – growth potential of about 154
routes (4)
Number of routes(1) Number of routes(2)
48 48
41 40
50
45
40 38
100
90
80
35
30
25
20
48
70
60
50
40
13
15
10
5
32
30
20
10
0
0
USA (Leisure) USA (VFR) CAM, SAM,
Canada,
Caribbean
(3)
R t Routes served d G Growth th t ti potential
l
Notes:
(1) Minimum stage length of 170 miles
(2) Minimum stage length of 200 miles; CAM stands for Central America; SAM stands for South America
(3) South and northbound leisure routes
(4) Figures calculated as of August 2014.
Source: Company data and DIIO MI Market Intelligence for the Aviation Industry
12
13. Substantial growth opportunity in the US-Mexico VFR /
leisure travel market
San
Francisco
0.7mm Denver
Sacramento 0.5mm
0 3
Chicago
1.5mm
Bakersfield
0.4mm
New York
0 5mm
Portland
0.2mm
San Jose
0.4mm
0.3mm
Fresno
0.5mm Las Vegas
0.4mm
Phoenix
Albuquerque
0.2mm
San Antonio
Dallas
1.5mm Atlanta
0.3mm
Washington
0.1mm
0.5mm
Philadelphia
0.1mm
Orlando
0 1mm
Los Angeles
4.6mm
San
1.2mm
Tucson
0.3mm El Paso
0.6mm
0.9mm
Austin
0.4mm
Houston
1.5mm
Mission
0.1mm
San
Diego
0.9mm
Bernardino
1.7mm
0 6
0.6mm Tampa
San Benito
0.3mm
0.1mm
Miami
0.1mm
Denotes Volaris
presence(1)
Denotes other cities with large
Mexican origin populations(1,2)
Significant Mexican origin
population(2) of 33.7 million
in the US
Notes:
(1) Represents Mexican origin population figures as per population data released on May 26, 2011
(2) Mexican origin is based on self-described ancestry, lineage, heritage, nationality group or country of birth.
Source: Pew Research Hispanic Center
13
14. Positive expansion, managing capacity and diversification of
routes
Solid expansion for Volaris
Volaris flown domestic routes Volaris flown international routes
More than 2x More than 1.5x
17
23 26 28
50
78 89
Dec '11 Dec '12 Dec '13 Sep '14
A competition( 1)
39 Dec '11 Dec '12 Dec '13 Sep '14
significant portion of our capacity faces no )
Percentage of Volaris’ 4Q14 domestic capacity competing with:
68%
54%
34%
20%
Aeromexico Interjet Vivaaerobus Non-competed
Notes:
(1) Capacity measured by ASM’s
Source: Data company, SCT-DGAC, DIIO MI 14
16. A higher density fleet generates more incremental capacity
with fewer additional aircraft
Projected fleet under current contracts (number of aircraft)(1)
18%
29% 47%
59
55
3
2 2
9 14
23
50
44
24 23 22
19
20 18 17 12
FY13 FY14 FY15 FY16
A319 A320 A320 w/Sharklets A320 NEO w/Sharklets A321 w/Sharklets % % of year‐end fleet
w/Sharklets
Seat growth 7% 13% 14%
Backlog of 64 Aircraft to support growth(2)
Notes:
(1) Net fleet after additions and returns
(2) Figure calculated as of the end of September 2014
Source: Company data
g pp g
16
17. Solid financial performance
Operating revenues(1) Adj. EBITDAR(1)
714
887
1,018 1,013
1,200
1,000
188
220
250
200 178
374
536
800
600
400
200
0
(USD mm)
117
140
100
150
100
50
0
(USD mm)
2009 2010 2011 2012 2013 LTM
Sep 14
2009 2010 2011 2012 2013 LTM
Sep 14
Operating Revenues CAGR 2009 - 2013 LTM September 2014 Adj. EBITDAR margin
28%
20%
30%
20%
17.5%
28.9%
30.0%
20.0% 18.1% 17.8%
14%
10%
10% 10.0%
0%
Copa GOL LATAM
Note:
(1) Figures converted to USD at an average exchange rate corresponding for the period, for convenience purposes only
(2) Figures calculated as of June LTM 2014
Source: Company data, airlines public information
17
0.0%
Copa(2) Gol(2) AM
18. Solid balance sheet and liquidity, well funded for growth
LTM Liquidity – Cash and Equivalents / Op.
Revenue
• IPO provided sufficient liquidity / capital
for growth over the next years
• Minimal on-balance sheet debt
• USD $68mm(1) of financial debt as
of September 2014
32.4%
28.7%
• Strong cash position
• USD $135mm of cash and
equivalents as of September 2014 13.7%
• Fully financed pre-delivery payments and
executed sale-leasebacks for all
deliveries in 2015 and 2016
8.2% 7.7%
Copa(2) Gol (2) LatAm(2) AM
Note:
(1) Principal + interest debt
(2) Figures calculated as of 1H 2014
Source: Company data, Airlines public information 18
20. Non-IFRS Terms Glossary
• Available seat miles (ASMs): Number of seats available for passengers multiplied by the number of miles the seats are flown.
• Block hours: Number of hours during which the aircraft is in revenue service, measured from the time it leaves the gate until the
time it arrives to the gate at destination.
• Revenue passenger miles (RPMs): Means the number of miles flown by passengers.
• TRASM: Total revenue divided by ASMs.
• RASM: Passenger revenue divided by ASMs.
• CASM: Total operating expenses, net divided by ASMs.
• CASM ex fuel: Total operating expenses, net excluding fuel expense divided by ASMs.
• Load factor: RPMs divided by ASMs and expressed as a percentage.
• EBITDA: Earnings before interest, taxes, depreciation and amortization.
• EBITDAR: Earnings before interest, taxes, depreciation, amortization and aircraft rent expense.
• Adj. EBITDAR: EBITDAR adjusted by non-cash and non-recurring items.
• Adj. Debt: Financial debt plus seven times the aircraft rent expense.
• Adj. Net debt: Adj. Debt minus cash and cash equivalents.
• VFR: Passengers who are visiting friends and relatives.
20
21. % Consolidated statements of operations summary
MXN millions unless otherwise stated (2) 2010A 2011A 2012A 2013A
September
YTD 2014A
September
YTD 2014A (1)
of total
operating
revenues
(USD
millions)
Passenger 6,278 8,036 10,177 11,117 8,163 607 81.0
Non-ticket 499 842 1,510 1,885 1,915 142 19.0
Total operating revenues 6,777 8,878 11,687 13,002 10,078 749 100
Fuel 2,146 3,823 4,730 5,086 4,088 304 40.6
Aircraft and engines rent expense 1,197 1,508 1,886 2,187 1,860 138 18.5
Salaries and benefits 852 1,120 1,303 1,563 1,174 87 11.6
Landing, take off and navigation expenses 868 1,282 1,640 1,924 1,577 117 15.7
Sales, marketing and distribution expenses 615 750 752 704 590 44 5.9
Maintenance expenses 276 380 499 572 473 35 4.7
Other operating expense 255 285 288 347 333 25 3.3
Depreciation and amortization 57 103 211 302 205 15 2.0
Total operating expenses 6,266 9,251 11,309 12,685 10,301 766 102.2
6
EBIT 511 (373) 378 317 (222) (17) (2.2)
Operating margin (%) 7.5 (4.2) 3.2 2.4 (2.2) (2.2)
Finance income 5 6 14 25 17 1 0.2
Finance cost (56) (58) (90) (126) (23) (2) (0.2)
Exchange (loss) gain, net (56) 110 (95) 66 112 8 1.1
Income tax benefit (expense) 239 0 (3) (17) 18 1 0.2
Net income (loss) 643 (315) 203 265 (98) (7) (1.0)
Net margin (%) 9.5 (3.6) 1.7 2.0 (1.0) (1.0)
Net income (loss) excluding special items (3) 643 (315) 203 379 (98) (7) (1.0)
Adjusted EBITDAR 1,770 1,238 2,475 2,806 1,842 137 18.3
Adj. EBITDAR margin (%) 26.1 13.9 21.2 21.6 18.3 18.3
EPS Basic and Diluted (cents) 31.0 (9.7) (0.7)
EPADS Basic and Diluted (cents) 310.4 (96.5) (7.2)
21
Notes:
(1) Figures converted to USD September end of the period spot exchange rate $13.4541, for convenience purposes only
(2) Audited financial information 2010A – 2013A
(3) Excludes debt prepayment of Ps.65 million, and reservation system migration costs and other non-recurring items of Ps.48 million.
Source: Company data
22. Consolidated statements of financial position summary
MXN millions unless otherwise stated (5) 2010A 2011A 2012A 2013A
September
2014A
September
2014A (1)
(USD millions)
Cash and cash equivalents 677 441 822 2,451 1,814 135
Current guarantee deposits 330 170 238 499 651 48
Other current assets 390 520 755 1,050 900 67
Total current assets 1,397 1,131 1,815 4,000 3,365 250
Rotable spare parts, furniture and
equipment, net 921 1,517 1,195 1,341 1,992 148
Non-current guarantee deposits 1,041 2,002 2,245 2,603 2,881 214
Other non-current assets 342 412 447 434 463 34
Total assets 3,701 5,062 5,702 8,378 8,701 647
Unearned transportation revenue 505 825 1,259 1,393 1,495 111
Short-term financial debt 251 687 527 268 271 20
Other short-term liabilities 1,171 1,667 1,936 2,211 2,256 168
Total short-term liabilities 1,927 3,179 3,722 3,872 4,022 299
Long-term financial debt 384 725 633 294 621 46
Other long-term liabilities 164 298 272 250 211 16
Total liabilities 2,475 4,202 4,627 4,416 4,854 361
Total equity 1,226 860 1,075 3,962 3,847 286
Total liabilities and equity 3,701 5,062 5,702 8,378 8,701 647
Net debt (2) (42) 971 338 (1,889) (992) (69)
Adjusted debt (3) 9,014 11,969 14,360 15,874 18,073 1,343
Adjusted net debt (4) 8,337 11,528 13,538 13,423 16,259 1,208
Nota:
(1) Figures converted to USD September end of the period spot exchange rate $13.4541, for convenience purposes only
(2) Net debt = financial debt - cash and cash equivalents
(3) Adjusted debt = (LTM aircraft rent expense x 7) + financial debt
(4) Adjusted net debt = adjusted debt - cash and cash equivalents
(5) Audited financial information 2010A – 2013A
Source: Company data
22
23. Consolidated statements of cash flows summary
MXN millions unless otherwise stated (2) 2010A 2011A 2012A 2013A September September
YTD 2014A
YTD 2014A (1)
(USD millions)
Cash flow from operating activities
Income (loss) before income tax 404 (315) 207 283 (116) (9)
Depreciation and amortization 62 103 211 302 205 15
Guarantee deposits (316) (801) (311) (620) (430) (32)
Unearned transportation revenue 207 321 433 135 101 8
Changes in working capital and provisions 182 544 (43) (61) 104 8
Net cash flows provided by (used in) operating
activities 539 (148) 497 39 (136) (10)
Cash flow from investing activities
Acquisitions of rotable spare parts, furniture, equipment (321) (1 21 ) 1,215) (8 6) 856) (1 161) 1,161) (1 090) 1,090) (81)
and intangible assets
Proceeds from disposals of rotable spare parts, furniture
and equipment
- 587 1,043 849 277 21
Net cash flows (used in) provided by investing
activities (321) (628) 187 (312) (813) (60)
Cash flow from financing activities
Legal costs incurred on behalf of shareholders (76) - - - - -
Net proceeds from initial public offering - - - 2,578 - -
Transaction costs on issue of shares - - - (38) - -
Proceeds from exercised treasury shares - - - 26 - -
Interest paid (60) (55) (127) (65) (16) (1)
Other financing costs - - - - (7) -
Payments of financial debt - (261) (694) (1,084) (268) (20)
Proceeds from financial debt 46 879 550 444 571 42
Net cash flows (used in) provided by financing
activities (90) 562 (272) 1,861 280 21
Increase (decrease) in cash and cash equivalents 128 (213) 412 1,588 (669) (50)
Net foreign exchange differences (25) (22) (31) 41 32 2
Cash and cash equivalents at beginning of period 575 677 441 822 2,451 182
Cash and cash equivalents at end of period 677 441 822 2,451 1,814 135
Notes:
(1) Figures converted to USD September end of the period spot exchange rate $13.4541, for convenience purposes only
(2) Audited financial information 2010A - 2013A
Source: Company data
23
24. Adj. EBITDA and Adj. EBITDAR reconciliation
MXN millions unless otherwise stated (2) 2010A 2011A 2012A 2013A September
YTD 2014A
September
YTD 2014A (1)
(USD millions)
Net income (loss) 643 (315) 203 265 (98) (7)
Plus (minus):
Finance costs 52 58 90 126 23 2
Finance income (5) (6) (14) (25) (17) (1)
(Benefit)/provision for income taxes (239) 0 3 17 (18) (1)
Depreciation and amortization 57 103 211 302 205 15
Business alliance amortization 5 - - - - -
EBITDA 513 (160) 494 685 95 7
Exchange (gain) loss, net 56 (110) 95 (66) (112) (8)
Other financing cost (income), net 3 - - - - -
Adjusted EBITDA 573 (270) 589 619 (17) (1)
Aircraft and engine rent expense 1,197 1,508 1,886 2,187 1,860 138
Adjusted EBITDAR 1,770 1,238 2,475 2,806 1,842 137
Notes:
(1) Figures converted to USD September end of the period spot exchange rate $13.4541, for convenience purposes only
(2) Audited financial information 2010A - 2013A
Source: Company data 24