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Press Release

Robust Liquidity Preservation Plan with Minimal Cash Burn, End Cash Balance of Ps.10 Billion

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MEXICO CITY, July 27, 2020 /PRNewswire/ — Volaris* (NYSE: VLRS and BMV: VOLAR), the ultra-low-cost airline serving Mexico, the United States and Central America, today announces its financial results for the second quarter 2020.

The following financial information, unless otherwise indicated, is presented in accordance with the International Financial Reporting Standards (IFRS).

Second Quarter 2020 Highlights

During the second quarter 2020, the Company carefully managed its capacity, measured by available seat miles (ASMs), in response to the decline in demand for air travel due to the virus SARS-CoV-2 (COVID-19).

In April, 2020 the Company announced that pursuant to a decree published in the Official Gazette of the Federation, the Government of the United Mexican States, acting through the General Health Council (Consejo de Salubridad General (“GHC”)) declared a health emergency due to force majeure, as a result of the disease pandemic caused by the COVID-19, which would be in effect until new notification (the “Declaration of Emergency”).

The Declaration of Emergency and the health security measures announced by the GHC, such as the suspension of non-essential activities in the public, private and social sector, as well as the call to the population to comply with stay at home, impacted the demand for passenger air transportation.

The second quarter of 2020 was characterized by three very different months: in April and May, the fall in demand required significant capacity cuts. In April, Volaris operated 18% ASMs vs the same period in 2019 and in May this fell still further to 12%. This trend was reversed in June, when Volaris operated 41% ASMs compared to those operated in the same period in 2019. This was a ramp-up of more than 234% compared to May 2020, taking advantage of the early signs of recovery particularly in the domestic market and the ramp-up was significantly faster than our domestic competitors. The domestic market held up better than the international markets and Central America remained closed altogether.

For the ramp-up in June and further into the third quarter, Volaris has taken a breadth over depth approach to network recovery, focusing on marginal contribution of flights. By end of June 2020 service re-started in 49% of domestic routes and 22% of US markets, albeit both at a lower frequency vs. 2019.

The main effects of the reductions and the gradual recovery of demand and capacity at the end of the second quarter, are described as follows:

  • Total operating revenues were Ps.1,526 million for the second quarter, a decrease of 81.7% year over year.
  • Total ancillary revenues were Ps.711 million for the second quarter, a decrease of 75.5% year over year. Total ancillary revenues per passenger for the second quarter reached Ps.644, an increase of 25.2% year over year. Total ancillary revenues represented 46.6% of total operating revenues for the second quarter 2020, increasing 11.7 percentage points with respect to the same period of last year.
  • Total operating revenues per available seat mile (TRASM) were Ps.108.9 cents for the second quarter, a decrease of 19.7% year over year.
  • Operating expenses per available seat mile (CASM) were Ps.274.4 cents for the second quarter, an increase of more than 100% year over year; with an average economic fuel cost per gallon of Ps.43.8 for the second quarter, a decrease of 10.4% year over year.
  • Operating expenses per available seat mile excluding fuel, (CASM ex fuel) reached Ps.234.3 cents for the second quarter, an increase of more than 100% year over year; with an average exchange rate depreciation of the Mexican peso against the U.S. dollar of 22.2% year over year.
  • Operating loss was Ps.2,347 million for the second quarter, a significant decrease compared with the operating income of Ps.659 million for the same period of last year. Operating margin for the second quarter was (153.8%), a deterioration of (161.7) percentage points year over year.
  • Net loss was Ps.1,644 million (Ps.1.62 loss per share / U.S.$0.71 loss per ADS), giving a negative net margin of (107.7%) for the second quarter.
  • At the close of the second quarter, the Mexican peso appreciated 2.3% against the U.S. dollar (Ps.22.97 per U.S. dollar) with respect to the exchange rate at the close of the previous quarter (Ps.23.51 per U.S. dollar). The Company booked a net foreign exchange gain of Ps.1,109 million derived from our U.S. dollar net monetary liability position.
  • During the second quarter of 2020, the net cash flow generated by operating activities was Ps.584 million. The net cash flow generated by investing activities reached Ps.71 million. The net cash flow used in financing activities was Ps.1,179 million, which included Ps.806 million of aircraft rental payments. The negative net foreign exchange difference was Ps.120 million, thus leading to a net decrease of cash and cash equivalents in the second quarter of Ps.644 million. As of June 30, 2020, cash and cash equivalents were Ps.10,013 million.

Fuel Price reduction and Peso Depreciation

  • Fuel price reduction: The average economic fuel cost per gallon decreased 10.4% in the second quarter of 2020, year over year, reaching Ps.43.8 per gallon (U.S.$1.9).
  • Peso depreciation: The Mexican peso depreciated 22.2% against the U.S. dollar year over year, from an average exchange rate of Ps.19.12 per U.S. dollar in the second quarter of 2019 to Ps.23.37 per U.S. dollar during the second quarter of 2020. At the end of the second quarter of 2020, the Mexican peso (Ps.22.97 per U.S. dollar) depreciated 19.8% with respect to the exchange rate at the end of the same period of the last year (Ps.19.17 per U.S. dollar).

Passenger Traffic Contraction, Ancillary Revenue Expansion, and TRASM decrease

  • Passenger traffic contraction: Volaris had 1.1 million passengers booked in the second quarter of 2020, a decrease of 80.5% year over year. Volaris traffic (measured in terms of revenue passenger miles, or RPMs) decreased 78.8% year over year. System load factor during the second quarter decreased 8.1 percentage points year over year to a level of 79.2%.
  • Total ancillary revenue reduction: For the second quarter of 2020, total ancillary revenue decreased 75.5% year over year. Total ancillary revenue per passenger in the second quarter of 2020 increased 25.2% year over year. The total ancillary revenue generation continues to grow with new and mature products, appealing to customers’ needs, representing 46.6% of total operating revenue of the second quarter, an increase of 11.7 percentage points year over year.
  • TRASM decrease: For the second quarter of 2020, TRASM decreased 19.7% year over year. During the second quarter of 2020, the total capacity, in terms of ASMs, decreased 76.6% year over year.

Total Unit Cost Raise and Peso depreciation 

  • CASM and CASM ex fuel in the second quarter of 2020 reached Ps.274.4 (U.S.$11.94 cents) and Ps.234.3 cents (U.S.$10.20), respectively. This represented an increase of more than 100% for CASM and CASM ex fuel, year over year; mainly driven by the capacity reduction as measured by available seat miles (ASMs), and the average exchange rate depreciation of the Mexican peso against the U.S. dollar of 22.2%.

Young and Fuel-Efficient Consumption Fleet

  • During the second quarter of 2020, the Company returned one A319 aircraft and incorporated one A320 NEO aircraft to its fleet. As of June 30, 2020, Volaris’ fleet comprised 82 aircraft (7 A319s, 59 A320s and 16 A321s), with an average age of 5.4 years. At the end of the second quarter of 2020, Volaris’ fleet had an average of 187 seats per aircraft, 76% of our aircraft were sharklet-equipped, and 29% were NEO.

Liquidity Preservation Plan with a Net Cash Flow Generated by Operating Activities

  • Since the COVID-19 contingency started, the Company´s main objective has been to preserve the liquidity position. The Company implemented a “liquidity preservation plan” which achieved a total of $6.1 billion pesos or $266 million in US dollar terms through payment deferrals and cost reductions for 2020. Around $1.6 billion pesos ($61 million dollars) were deferred to 2021. Specifically, for the second quarter, our liquidity preservation plan brought $2.2 billion pesos in benefits; of which $357 million pesos were cost avoidance.
  • During the second quarter of 2020, the net cash flow generated by operating activities was Ps.584 million. The net cash flow generated by investing activities reached Ps.71 million. The net cash flow used in financing activities was Ps.1,179 million, which included Ps.806 million of aircraft rental payments. The negative net foreign exchange difference was Ps.120 million, thus having a net decrease of cash and cash equivalents in the second quarter of Ps.644 million. As of June 30, 2020, cash and cash equivalents were Ps.10,013 million, representing 35.0% of last twelve months of the operating revenue. Volaris registered a negative net debt (or a positive net cash position) of Ps.4,568 million (excluding lease liability recognized under the IFRS16 adoption).

Non derivatives financial instruments

  • During 2019, the Company established hedges on its U.S. dollar denominated revenues through a non-derivative financial instrument, using the lease liabilities denominated in U.S. dollar as a hedge instrument. This hedging relationship was designated as a cash flow hedge of forecasted revenues to mitigate the volatility of the foreign exchange variation arising from the revaluation of the lease liabilities. During the second quarter 2020, the impact of these hedges was Ps.39 million, which has been presented as part of the total operating revenue.
  • Additionally, during 2019, the Company established hedges on a portion of its forecasted fuel expense, through a non-derivative financial instrument, using as a hedge instrument a portion of its U.S. dollar denominated monetary assets. This hedging relationship was designated as a cash flow hedge of forecasted fuel expense to mitigate the volatility of the foreign exchange variation arising from the revaluation of this portion of U.S. dollar denominated monetary asset. During the second quarter 2020, the impact of these hedges was Ps.71 million, which has been presented as part of the total fuel expense.
  • For the hedging relationships described, the effective portion of the hedging instrument’s change in fair value is recognized in Other Comprehensive Income or OCI. The accounting records corresponding to the recycling of the OCI are made in accordance with IFRS 9. Under this Standard, the portion recorded in OCI is recognized in the results in the same period in which the expected hedging for cash flows affect the result of the period. As of June 30, 2020, OCI includes a negative foreign exchange effect of Ps.5,847 million. As of December 31, 2019, OCI includes a positive foreign exchange effect of Ps.14 million.

Investors are urged to carefully read the Company’s periodic reports filed with or provided to the Securities and Exchange Commission, for additional information regarding the Company.

Conference Call/Webcast Details:

Presenters for the Company:

 

 

Mr. Enrique Beltranena, President & CEO

Mr. Holger Blankenstein, Airline  Commercial and Operation EVP

Mr. Jaime Pous,  Senior Vice President Chief Legal Officer and Corporate Affairs and Interim CFO

Date:

Monday, July 27, 2020

Time:

10:00 am U.S. EDT (9:00 am Mexico City Time)

United States dial in (toll free):

1-877-830-2576

Mexico dial in (toll free):

001-800-514-6145

Brazil dial in (toll free):

0800-891-6744

International dial in:

+ 1-785-424-1726

Participant passcode:

VOLARIS

Webcast will be available at:

https://services.choruscall.com/links/vlrs200727iiu07GYo.html

About Volaris:

*Controladora Vuela Compañía de Aviación, S.A.B. de C.V. (“Volaris” or the “Company”) (NYSE: VLRS and BMV: VOLAR), is an ultra-low-cost carrier, with point-to-point operations, serving Mexico, the United States and Central America. Volaris offers low base fares to build its market, providing quality service and extensive customer choice. Since the beginning of operations in March 2006, Volaris has increased its routes from five to more than 96 and its fleet from four to 82 aircraft. Volaris offers more than 229 daily flight segments on routes that connect 39 cities in Mexico and 15 cities in the United States and Central America with the youngest fleet in Mexico. Volaris targets passengers who are visiting friends and relatives, cost-conscious business and leisure travelers in Mexico, the United States and Central America. Volaris has received the ESR Award for Social Corporate Responsibility for eleven consecutive years. For more information, please visit: www.volaris.com.

Forward-looking Statements:

Statements in this release contain various forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which represent the Company’s expectations, beliefs or projections concerning future events and financial trends affecting the financial condition of our business. When used in this release, the words “expects,” “intends,” “estimates,” “predicts,” “plans,” “anticipates,” “indicates,” “believes,” “forecast,” “guidance,” “potential,” “outlook,” “may,” “continue,” “will,” “should,” “seeks,” “targets” and similar expressions are intended to identify forward-looking statements. Similarly, statements that describe the Company’s objectives, plans or goals, or actions the Company may take in the future, are forward-looking statements. Forward-looking statements include, without limitation, statements regarding the Company’s intentions and expectations regarding the delivery schedule of aircraft on order, announced new service routes and customer savings programs. Forward-looking statements should not be read as a guarantee or assurance of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved.  Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Forward-looking statements are subject to a number of factors that could cause the Company’s actual results to differ materially from the Company’s expectations, including the competitive environment in the airline industry; the Company’s ability to keep costs low; changes in fuel costs; the impact of worldwide economic conditions on customer travel behavior; the Company’s ability to generate non-ticket revenues; and government regulation. Additional information concerning these, and other factors is contained in the Company’s Securities and Exchange Commission filings. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements set forth above.  Forward-looking statements speak only as of the date of this release.  You should not put undue reliance on any forward-looking statements.  We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by applicable law.  If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.


Controladora Vuela Compañía de Aviación, S.A.B. de C.V. and Subsidiaries
Financial and Operating Indicators






Unaudited

 

Three months ended
June 30, 2020

Three months ended June 30, 2020

 

Three months ended June 30, 2019

Variance

(In Mexican pesos, except otherwise indicated)

(US Dollars)*

(%)

Total operating revenues (millions)

66

1,526

8,329

(81.7%)

Total operating expenses (millions)

169

3,873

7,670

(49.5%)

EBIT (millions)

(102)

(2,347)

659

NA

EBIT margin

(153.8%)

(153.8%)

7.9%

(161.7) pp

Depreciation and amortization

63

1,451

1,335

8.7%

Aircraft and engine variable lease expenses

19

426

316

34.9%

Net (loss) income (millions)

(72)

(1,644)

119

NA

Net (loss) income margin

(107.7%)

(107.7%)

1.4%

(109.1) pp

(Loss) income per share:





Basic (pesos)

(0.07)

(1.62)

0.12

NA

Diluted (pesos)

(0.07)

(1.62)

0.12

NA

(Loss) income per ADS:





Basic (pesos)

(0.71)

(16.24)

1.18

NA

Diluted (pesos)

(0.71)

(16.24)

1.18

NA

Weighted average shares outstanding:





Basic

1,011,876,677

1,011,876,677

0.0%

Diluted

1,011,876,677

1,011,876,677

0.0%

Available seat miles (ASMs) (millions) (1)

1,437

6,154

(76.6%)

     Domestic

1,202

4,250

(71.7%)

     International

235

1,904

(87.7%)

Revenue passenger miles (RPMs) (millions) (1)

1,138

5,370

(78.8%)

     Domestic

936

3,812

(75.4%)

     International

202

1,558

(87.0%)

Load factor (2) 

79.2%

87.3%

(8.1) pp

     Domestic

77.8%

89.7%

(11.9) pp

     International

86.3%

81.9%

4.4 pp

Total operating revenue per ASM (TRASM) (cents) (1) (5)  

4.7

108.9

135.5

(19.7%)

Total ancillary revenue per passenger (4) (5)

28.0

644

514

25.2%

Total operating revenue per passenger (5)

61.7

1,417

1,475

(4.0%)

Operating expenses per ASM (CASM) (cents) (1) (5)

11.94

274.4

124.9

>100%

Operating expenses per ASM (CASM) (US cents) (3) (5)

11.74

6.53

79.9%

CASM ex fuel (cents) (1) (5) 

10.20

234.3

74.5

>100%

CASM ex fuel (US cents) (3) (5)

10.03

3.89

>100%

Booked passengers (thousands) (1)

1,105

5,654

(80.5%)

Departures (1)

7,785

34,848

(77.7%)

Block hours (1)

19,472

87,686

(77.8%)

Fuel gallons consumed (millions)

13.1

63.4

(79.3%)

Average economic fuel cost per gallon (5)

1.9

43.8

48.9

(10.4%)

Aircraft at end of period

82

78

5.1%

Average aircraft utilization (block hours)

7.7

13.1

(41.1%)

Average exchange rate

23.37

19.12

22.2%

End of period exchange rate

22.97

19.17

19.8%

*Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.

(1) Includes schedule and charter.                                                                    (3) Dollar amounts were converted at average exchange rate of each period.

(2) Includes schedule.                                                                                       (4) Includes “Other passenger revenues” and “Non-passenger revenues”.

(5) Excludes non-derivatives financial instruments.


Controladora Vuela Compañía de Aviación, S.A.B. de C.V. and Subsidiaries
Financial and Operating Indicators


Unaudited

 

Six months ended
June 30, 2020

Six months ended
June 30, 2020

 

Six months ended
June 30, 2019

Variance

(In Mexican pesos, except otherwise indicated)

(US Dollars)*

(%)

Total operating revenues (millions)

407

9,350

15,522

(39.8%)

Total operating expenses (millions)

496

11,389

14,836

(23.2%)

EBIT (millions)

(89)

(2,039)

685

NA

EBIT margin

(21.8%)

(21.8%)

4.4%

(26.2) pp

Depreciation and amortization

126

2,893

2,627

10.1%

Aircraft and engine variable lease expenses

35

801

543

47.5%

Net (loss) income (millions)

(137)

(3,137)

639

NA

Net (loss) income margin

(33.5%)

(33.5%)

4.1%

(37.6) pp

(Loss) income per share:





Basic (pesos)

(0.13)

(3.10)

0.63

NA

Diluted (pesos)

(0.13)

(3.10)

0.63

NA

(Loss) income per ADS:





Basic (pesos)

(1.35)

(31.00)

6.31

NA

Diluted (pesos)

(1.35)

(31.00)

6.31

NA

Weighted average shares outstanding:





Basic

1,011,876,677

1,011,876,677

0.0%

Diluted

1,011,876,677

1,011,876,677

0.0%

Available seat miles (ASMs) (millions) (1)

7,533

11,858

(36.5%)

     Domestic

5,455

8,221

(33.6%)

     International

2,078

3,637

(42.9%)

Revenue passenger miles (RPMs) (millions) (1)

6,304

10,114

(37.7%)

     Domestic

4,596

7,198

(36.2%)

     International

1,708

2,916

(41.4%)

Load factor (2) 

83.7%

85.3%

(1.6) pp

     Domestic

84.2%

87.6%

(3.4) pp

     International

82.2%

80.3%

1.9 pp

Total operating revenue per ASM (TRASM) (cents) (1) (5)  

5.4

125.0

131.0

(4.6%)

Total ancillary revenue per passenger (4) (5)

25.2

578

515

12.2%

Total operating revenue per passenger (5)

64.2

1,475

1,463

0.8%

Operating expenses per ASM (CASM) (cents) (1) (5)

6.7

152.8

125.2

22.0%

Operating expenses per ASM (CASM) (US cents) (3) (5)

7.1

6.5

8.2%

CASM ex fuel (cents) (1) (5) 

4.8

111.1

76.5

45.3%

CASM ex fuel (US cents) (3) (5)

5.14

3.99

28.9%

Booked passengers (thousands) (1)

6,382

10,617

(39.9%)

Departures (1)

41,446

67,046

(38.2%)

Block hours (1)

106,110

170,534

(37.8%)

Fuel gallons consumed (millions)

75.0

121.7

(38.3%)

Average economic fuel cost per gallon (5)

1.8

41.8

47.5

(12.0%)

Aircraft at end of period

82

78

5.1%

Average aircraft utilization (block hours)

11.4

12.9

(11.6%)

Average exchange rate

21.62

19.17

12.8%

End of period exchange rate

22.97

19.17

19.8%

*Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.

(1) Includes schedule and charter.                                                                    (3) Dollar amounts were converted at average exchange rate of each period.

(2) Includes schedule.                                                                                       (4) Includes “Other passenger revenues” and “Non-passenger revenues”.

(5) Excludes non-derivatives financial instruments.


Controladora Vuela Compañía de Aviación, S.A.B. de C.V. and Subsidiaries
Consolidated Statement of Operations


Unaudited

 

Three months ended
June 30, 2020

Three months ended

June 30, 2020

 

Three months ended

June 30, 2019

Variance

(In millions of Mexican pesos)

(US Dollars) *

(%)

Operating revenues:





Passenger revenues

63

1,436

8,038

(82.1%)

 Fare revenues

37

854

5,431

(84.3%)

 Other passenger revenues

25

582

2,607

(77.7%)






Non-passenger revenues

6

129

302

(57.3%)

 Other non-passenger revenues

4

102

250

(59.1%)

 Cargo

1

27

52

(48.3%)






 Non-derivatives financial instruments

(2)

(39)

(11)

>100%






Total operating revenues

66

1,526

8,329

(81.7%)






Other operating income

(8)

(180)

(123)

46.1%

Depreciation of right of use assets

54

1,240

1,180

5.1%

Salaries and benefits

29

665

887

(25.0%)

Fuel expense, net (1)

22

505

3,087

(83.6%)

Landing, take-off and navigation expenses

19

438

1,188

(63.2%)

Aircraft and engine variable lease expenses

19

426

316

34.9%

Sales, marketing and distribution expenses

8

179

350

(48.8%)

Maintenance expenses

7

166

369

(55.2%)

Other operating expenses

10

224

260

(14.0%)

Depreciation and amortization

9

210

155

35.9%

Operating expenses

169

3,873

7,670

(49.5%)






Operating (loss) income

(102)

(2,347)

659

NA






Finance income

1

27

54

(49.9%)

Finance cost (2)

(50)

(1,137)

(520)

>100%

Exchange gain, net

48

1,109

3

>100%

Comprehensive financing result

(1)

(462)

(99.7%)






(Loss) income before income tax

(102)

(2,348)

197

NA

Income tax benefit (expense)

31

704

(78)

NA

Net (loss) income

(72)

(1,644)

119

NA






* Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.

(1) 2Q 2020 and 2Q 2019 figures include a benefit from non-derivatives financial instruments by an amount of Ps.70.5 million and Ps.13.7 million, respectively.

(2) During second quarter 2020, as a result of the capacity reduction due to COVID-19, the Company recorded the ineffective portion related to the derivative financial instruments by an amount of Ps.429 million, which is presented as part of the financial costs.


Controladora Vuela Compañía de Aviación, S.A.B. de C.V. and Subsidiaries
Consolidated Statement of Operations


Unaudited

 

Six months ended
June 30,
2020

Six months ended

June 30, 2020

 

Six months ended

June 30, 2019

Variance

(%)

(In millions of Mexican pesos)

(US Dollars) *

Operating revenues:





Passenger revenues

391

8,984

15,015

(40.2%)

 Fare revenues

249

5,727

10,061

(43.1%)

 Other passenger revenues

142

3,257

4,954

(34.3%)






Non-passenger revenues

19

433

518

(16.5%)

 Other non-passenger revenues

15

350

404

(13.5%)

 Cargo

4

83

114

(27.0%)






 Non-derivatives financial instruments

(3)

(66)

(11)

>100%






Total operating revenues

407

9,350

15,522

(39.8%)






Other operating income

(13)

(301)

(123)

>100%

Fuel expense, net (1)

131

3,018

5,770

(47.7%)

Depreciation of right of use assets

108

2,474

2,336

5.9%

Landing, take-off and navigation expenses

83

1,915

2,420

(20.9%)

Salaries and benefits

70

1,605

1,739

(7.7%)

Aircraft and engine variable lease expenses

35

801

543

47.5%

Sales, marketing and distribution expenses

24

542

621

(12.7%)

Maintenance expenses

17

399

723

(44.7%)

Other operating expenses

23

517

516

0.2%

Depreciation and amortization

18

419

291

43.9%

Operating expenses

496

11,389

14,836

(23.2%)






Operating (loss) income

(89)

(2,039)

685

NA






Finance income

3

76

92

(17.1%)

Finance cost (2)

(78)

(1,794)

(1,023)

75.4%

Exchange (loss) gain, net

(32)

(725)

1,157

NA

Comprehensive financing result

(106)

(2,442)

227

NA






(Loss) income before income tax

(195)

(4,481)

912

NA

Income tax benefit (expense)

59

1,344

(274)

NA

Net (loss) income

(137)

(3,137)

639

NA






* Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.

(1) 2Q YTD 2020 and 2Q YTD 2019 figures include a benefit from non-derivatives financial instruments by an amount of Ps.118.7 million and Ps.13.9 million, respectively.

(2) During second quarter 2020, as a result of the capacity reduction due to COVID-19, the Company recorded the ineffective portion related to the derivative financial instruments by an amount of Ps.429 million, which is presented as part of the financial costs.


Controladora Vuela Compañía de Aviación, S.A.B. de C.V. and Subsidiaries
Reconciliation of total ancillary revenue per passenger


The following table shows quarterly additional detail about the components of total ancillary revenue:


Unaudited

Three months ended

June 30, 2020

(US Dollars)*

Three months ended

June 30, 2020

 

Three months ended

June 30, 2019

Variance

(%)

(In millions of Mexican pesos)






Other passenger revenues

25

582

2,607

(77.7%)

Non-passenger revenues

6

129

302

(57.3%)

Total ancillary revenues

31

711

2,909

(75.5%)






Booked passengers (thousands)

1,105

5,654

(80.5%)






Total ancillary revenue per passenger

28

644

514

25.2%






* Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.


The following table shows the first one half of the year additional detail about the components of total ancillary revenue:


Unaudited

Six months ended

June 30, 2020

(US Dollars)*

Six months ended

June 30, 2020

 

Six months ended

June 30, 2019

Variance

(%)

(In millions of Mexican pesos)






Other passenger revenues

142

3,257

4,954

(34.3%)

Non-passenger revenues

19

433

518

(16.5%)

Total ancillary revenues

161

3,689

5,472

(32.6%)






Booked passengers (thousands)

6,382

10,617

(39.9%)






Total ancillary revenue per passenger

25.2

578

515

12.2%






* Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.


Controladora Vuela Compañía de Aviación, S.A.B. de C.V. and Subsidiaries
Consolidated Statement of Financial Position


(In millions of Mexican pesos)

June 30, 2020

Unaudited

June 30, 2020 Unaudited

December 31, 2019

Audited

(US Dollars)*

Assets




Cash and cash equivalents

436

10,013

7,980

Accounts receivable

119

2,743

2,320

Inventories

12

278

302

Prepaid expenses and other current assets

45

1,045

781

Financial instruments

1

28

134

Guarantee deposits

62

1,416

600

Total current assets

676

15,522

12,117

Rotable spare parts, furniture and equipment, net

306

7,021

7,385

Right of use assets

1,428

32,799

34,129

Intangible assets, net

7

167

167

Financial instruments

2

3

Deferred income taxes

139

3,194

1,543

Guarantee deposits

381

8,759

7,644

Other assets

5

120

166

Other long- term assets

9

199

141

Total non-current assets

2,275

52,261

51,178

Total assets

2,951

67,783

63,295

Liabilities




Unearned transportation revenue

254

5,832

3,680

Accounts payable

160

3,678

1,656

Accrued liabilities

77

1,759

2,532

Lease liabilities

298

6,844

4,721

Other taxes and fees payable

99

2,267

2,102

Income taxes payable

2

141

Financial instruments

38

869

Financial debt

155

3,569

2,086

Other liabilities

13

304

407

Total short-term liabilities

1,094

25,124

17,324

Financial instruments

Financial debt

82

1,876

2,890

Accrued liabilities

3

72

91

Lease liabilities

1,842

42,307

35,797

Other liabilities

103

2,371

1,470

Employee benefits

2

45

38

Deferred income taxes

7

156

156

Total long-term liabilities

2,038

46,827

40,441

Total liabilities

3,132

71,951

57,765

Equity




Capital stock

129

2,974

2,974

Treasury shares

(8)

(176)

(170)

Contributions for future capital increases

Legal reserve

13

291

291

Additional paid-in capital

81

1,851

1,880

Retained (losses) earnings

(117)

(2,698)

438

Accumulated other comprehensive income (losses) (1)

(279)

(6,409)

116

Total equity

(181)

(4,167)

5,530

Total liabilities and equity

2,951

67,783

63,295





Total shares outstanding fully diluted


1,011,876,677

1,011,876,677

* Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.

(1) As of June 30, 2020 and as of December 31, 2019 the figures include a negative foreign exchange effect of Ps.5,847 million and a positive foreign exchange effect of Ps.14 million, respectively, related to non-derivatives financial instruments.

                              


Controladora Vuela Compañía de Aviación, S.A.B. de C.V. and Subsidiaries
Consolidated Statement of Cash Flows – Cash Flow Data Summary


Unaudited

 

Three months ended

June 30, 2020

Three months ended

June 30, 2020

 

Three months ended

June 30, 2019

(In millions of Mexican pesos)

(US Dollars)*





Net cash flow generated by operating activities

25

584

1,527

Net cash flow generated by investing activities

3

71

171

Net cash flow used in financing activities**

(51)

          (1,179) 

(571)

(Decrease) increase in cash and cash equivalents

(23)

(524)

1,127

Net foreign exchange differences

(5)

(120)

(74)

Cash and cash equivalents at beginning of period

464

10,658

7,071

Cash and cash equivalents at end of period

436

10,013

8,124





* Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.

**Includes aircraft rental payments of Ps.806 million and Ps.1,582 million for the three months ended period June 30, 2020 and 2019, respectively.


Unaudited

 

Six months ended

June 30, 2020

Six months ended

June 30, 2020

 

Six months ended

June 30, 2019

(In millions of Mexican pesos)

(US Dollars)*





Net cash flow generated by operating activities

148

3,403

5,257

Net cash flow generated by (used in) investing activities

1

34

(208)

Net cash flow used in financing activities**

(133)

          (3,048) 

(2,633)

Increase in cash and cash equivalents

17

389

2,416

Net foreign exchange differences

72

1,645

(155)

Cash and cash equivalents at beginning of period

347

7,980

5,863

Cash and cash equivalents at end of period

436

10,013

8,124





* Peso amounts were converted to U.S. dollars at end of period exchange rate for convenience purposes only.

**Includes aircraft rental payments of Ps.2,626 million and Ps.3,130 million for the six months ended period June 30, 2020 and 2019, respectively.

SOURCE Volaris

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Press Release

The Pressing Need for Early Detection of Mucormycosis during COVID-19

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Fapon Biotech calls for cooperation with academic and industry partners in developing mucormycosis diagnostic tests to ease the challenge by sharing the abilities of upstream raw material development platforms and downstream reagent application platforms.

DONGGUAN, China, June 21, 2021 /PRNewswire/ — Mucormycosis or black fungus, a devastating infection that soars in India during COVID-19 has seized global attention. Recently, the country’s mucormycosis cases reached over 57,150 and resulted in 54% mortality. Apart from the association with high diabetes prevalence in India, COVID-19 infected countries (Pakistan, Russia, Nepal, Chile, Brazil, etc.) have also described the same issue, areas with high diabetes and COVID-19 infection rates should be alarmed.

Fapon Biotech calls for cooperation with academic and industry partners in developing mucormycosis diagnostic tests to ease the challenge by sharing the abilities of upstream raw material development platforms and downstream reagent application platforms.

Unfortunately, mucormycosis is always being diagnosed late with prolonged COVID-19 healthcare burdens that deteriorate the situation. As a company making continuous research and contribution to the world’s major infectious diseases with the mission to Enable Disease Identification Earlier, More Accurate, Convenient and Affordable, Fapon Biotech Inc. (Fapon Biotech) calls for cooperation with academic and industry partners in developing mucormycosis diagnostic tests to ease the challenge by sharing the abilities of upstream raw material development platforms and downstream reagent application platforms.

Fapon Biotech is one of the mainstream COVID-19 reagent raw material suppliers with proven experiences helping partners to launch accredited COVID-19 reagents in a short time. The company has over 1000 IVD partners worldwide with more than 10 years of business operation in India. Its technology platforms can match the R&D process from partners easily and provide supports from biomarker discovery to commercialization. Through different application platforms of Fapon Biotech (Colloidal Gold/Immunofluorescence/ELISA/CLIA/Latex-Enhanced Immunoturbidimetry/PCR/etc.), biomarkers can quickly complete the process of application development. For partners encountering production challenges, OEM and contract manufacturing services with the capacity reaching hundreds of grams of each batch are available. Because of a strong relationship with laboratories and IVD manufacturers in India, cooperating with Fapon Biotech will have the access to more resources and commercial opportunities, such as clinical samples for research and product validation, technology iterations, product launch and promotion, etc.

As the virus continues its mutation and triggers diseases like mucormycosis to complicate the situation, rapid responses via global cooperation will be crucial for areas with overwhelmed healthcare burdens. Fapon Biotech is committed to fueling the advancement of COVID-19 diagnosis through collaborations with international IVD partners.

About Fapon Biotech

Fapon Biotech was founded in 2001. Guided by the mission of “Enable Disease Identification Earlier, More Accurate, Convenient and Affordable,” the company focuses on the future needs of biotechnology developments and provides global diagnostic companies with high-performance IVD reagent raw materials, such as antigens, antibodies, and enzymes, as well as one-stop solutions with instrument and reagent services.

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Press Release

RedHill Biopharma Announces Presentation of Positive Oral Opaganib Phase 2 Data in COVID-19

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RedHill Biopharma logo

Positive U.S. Phase 2 safety and efficacy data for opaganib, a leading novel, oral, dual-mechanism drug candidate for moderate-to-severe COVID-19, presented at the World Microbe Forum

Opaganib was associated with a reduction in the need for supplemental oxygen support, earlier time to discharge from hospital and was well tolerated

Opaganib’s global 475-patient Phase 2/3 study is fully enrolled, with study completion expected in the coming weeks

Opaganib is host-targeted and expected to be effective against emerging viral variants

TEL AVIV, Israel and RALEIGH, NC, June 21, 2021 /PRNewswire/ — RedHill Biopharma Ltd. (Nasdaq: RDHL) (“RedHill” or the “Company”), a specialty biopharmaceutical company, today announced presentation of the positive Phase 2 safety and efficacy data for oral opaganib (Yeliva®, ABC294640)[1] in hospitalized patients with COVID-19 pneumonia at the World Microbe Forum (WMF) 2021 (poster #: 5574).

RedHill Biopharma logo

Results and post hoc analyses of data from the 40-patient U.S. Phase 2 study were presented in a poster entitled, “Opaganib, an Oral Sphingosine Kinase-2 (SK2) Inhibitor in COVID-19 Pneumonia: A Randomized, Double-blind, Placebo-controlled Phase 2A Study, in Adult Subjects Hospitalized with SARS-CoV-2 Positive Pneumonia (NCT: 04414618)“[2]. Patients in the study were randomized to receive either opaganib or placebo in addition to standard of care (SoC), predominantly including dexamethasone and/or remdesivir. Findings include:

  • 50% of patients treated with opaganib (n=22) reached room air by Day 14 compared to 22% in the placebo group (n=18). The benefit of reaching room air by Day 14 for patients on opaganib was maintained regardless of whether the patients were receiving dexamethasone and/or remdesivir
  • 86.4% of patients treated with opaganib were discharged from hospital by Day 14 compared to 55.6% of patients treated with placebo
  • Median time to discharge was 6 days for the opaganib group compared to 7.5 days for the placebo group
  • 81.8% of opaganib patients achieved a 2-point improvement in the WHO Ordinal Scale compared to 55.6% of patients in the placebo group – achieved in a median time of 6 days versus 7.5 days, respectively
  • No significant differences in safety-related measures between the two groups (with diarrhea being the main treatment-emergent difference in tolerability)

“The need for an effective oral therapy to treat COVID-19 is clear. Such a therapy would greatly improve our ability to manage this pandemic,” said Kevin Winthrop, MD, MPH, Professor of Infectious Diseases at Oregon Health & Science University, who presented the findings at WMF. “These data, from this proof-of-concept clinical study of opaganib in patients with severe COVID-19, suggest a potential role of SK2 inhibition in combating the effects of this virus. With much more data on opaganib expected in the coming weeks, we could make some real progress toward having access to a much-needed oral therapy for patients who currently have a paucity of options available to them.”

“Presentation of these positive data from our exploratory Phase 2 study support our growing confidence that opaganib could be the first novel, oral therapy to demonstrate efficacy in the treatment of COVID-19 in a large late-stage study. With the recent completion of enrollment of our 475-patient global Phase 2/3 study, we will have a clearer picture of that in the very near future,” said Mark L. Levitt, MD, Ph.D., Medical Director at RedHill. “Opaganib acts on both the cause and effect of COVID-19 via a unique dual antiviral and anti-inflammatory mode of action. Being host-targeted, opaganib is also expected to maintain effect against the emerging SARS-CoV-2 variants, which continue to threaten the progress being made against the pandemic and underscore the urgent need for effective COVID-19 therapeutics.”

The global 475-patient Phase 2/3 study of opaganib in severe COVID-19 has been approved in 10 countries and completed enrollment, through 57 participating sites, on June 6th. The primary endpoint of the study is the proportion of patients breathing room air without oxygen support by Day 14. Additional important outcome measures, such as time to discharge from hospital, improvement according to the World Health Organization Ordinal Scale for Clinical Improvement and incidence of intubation and mortality, will also be captured in the follow-up period of up to 6 weeks. The study received four independent DSMB recommendations to continue following unblinded safety reviews and a futility review. Additionally, an evaluation of the blinded blended intubation and mortality rates to date was encouraging as compared to reported rates of mortality from large platform studies such as RECOVERY, and other studies in similar patient populations[3].

About Opaganib (Yeliva®, ABC294640)

Opaganib, a new chemical entity, is a proprietary, first-in-class, orally-administered, sphingosine kinase-2 (SK2) selective inhibitor, with dual anti-inflammatory and antiviral activity, that is host-targeted and is therefore expected to be effective against emerging viral variants. Opaganib has also shown anticancer activity and has the potential to target multiple oncology, viral, inflammatory, and gastrointestinal indications.

Opaganib is being evaluated as a treatment for COVID-19 pneumonia in a global Phase 2/3 study, which recently completed enrollment, and has demonstrated positive safety and efficacy signals in preliminary top-line data from the 40-patient U.S. Phase 2 study.

Opaganib has also received Orphan Drug designation from the U.S. FDA for the treatment of cholangiocarcinoma and is being evaluated in a Phase 2a study in advanced cholangiocarcinoma and in a Phase 2 study in prostate cancer.

Opaganib demonstrated potent antiviral activity against SARS-CoV-2, the virus that causes COVID-19, completely inhibiting viral replication in an in vitro model of human lung bronchial tissue. Additionally, preclinical in vivo studies have demonstrated opaganib’s potential to ameliorate inflammatory lung disorders, such as pneumonia, and has shown decreased fatality rates from influenza virus infection and ameliorated Pseudomonas aeruginosa-induced lung injury by reducing the levels of IL-6 and TNF-alpha in bronchoalveolar lavage fluids[4].

The ongoing studies with opaganib are registered on www.ClinicalTrials.gov, a web-based service by the U.S. National Institute of Health, which provides public access to information on publicly and privately supported clinical studies.   

About RedHill Biopharma    

RedHill Biopharma Ltd. (Nasdaq: RDHL) is a specialty biopharmaceutical company primarily focused on gastrointestinal and infectious diseases. RedHill promotes the gastrointestinal drugs, Movantik® for opioid-induced constipation in adults[5], Talicia® for the treatment of Helicobacter pylori (H. pylori) infection in adults[6], and Aemcolo® for the treatment of travelers’ diarrhea in adults[7]. RedHill’s key clinical late-stage development programs include: (i) RHB-204, with an ongoing Phase 3 study for pulmonary nontuberculous mycobacteria (NTM) disease; (ii) opaganib (Yeliva®, ABC294640), a firstinclass SK2 selective inhibitor targeting multiple indications with positive Phase 2 COVID-19 data and an ongoing Phase 2/3 program for COVID-19 and Phase 2 studies for prostate cancer and cholangiocarcinoma ongoing; (iii) RHB-107 (upamostat), a serine protease inhibitor in a U.S. Phase 2/3 study as treatment for symptomatic COVID-19, and targeting multiple other cancer and inflammatory gastrointestinal diseases; (iv) RHB-104, with positive results from a first Phase 3 study for Crohn’s disease; (v) RHB-102 (Bekinda®), with positive results from a Phase 3 study for acute gastroenteritis and gastritis and positive results from a Phase 2 study for IBS-D; and (vi) RHB106, an encapsulated bowel preparation. More information about the Company is available at www.redhillbio.com / https://twitter.com/RedHillBio.         

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be preceded by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. Forward-looking statements are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company’s control and cannot be predicted or quantified, and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include the delay in last patient visit and top-line data from the Phase 2/3 COVID-19 study for opaganib, that the Phase 2/3 COVID-19 study for opaganib may not be successful and, even if successful, such study and results may not be sufficient for regulatory applications, including emergency use or marketing applications, and that additional COVID-19 studies for opaganib are likely to be required by regulatory authorities to support such potential applications and the use or marketing of opaganib for COVID-19 patients, that opaganib will not be effective against emerging viral variants, as well as risks and uncertainties associated with (i) the initiation, timing, progress and results of the Company’s research, manufacturing, preclinical studies, clinical trials, and other therapeutic candidate development efforts, and the timing of the commercial launch of its commercial products and ones it may acquire or develop in the future; (ii) the Company’s ability to advance its therapeutic candidates into clinical trials or to successfully complete its preclinical studies or clinical trials (iii) the extent and number and type of additional studies that the Company may be required to conduct and the Company’s receipt of regulatory approvals for its therapeutic candidates, and the timing of other regulatory filings, approvals and feedback; (iv) the manufacturing, clinical development, commercialization, and market acceptance of the Company’s therapeutic candidates and Talicia®; (v) the Company’s ability to successfully commercialize and promote Movantik®, Talicia® and Aemcolo®; (vi) the Company’s ability to establish and maintain corporate collaborations; (vii) the Company’s ability to acquire products approved for marketing in the U.S. that achieve commercial success and build and sustain its own marketing and commercialization capabilities; (viii) the interpretation of the properties and characteristics of the Company’s therapeutic candidates and the results obtained with its therapeutic candidates in research, preclinical studies or clinical trials; (ix) the implementation of the Company’s business model, strategic plans for its business and therapeutic candidates; (x) the scope of protection the Company is able to establish and maintain for intellectual property rights covering its therapeutic candidates and commercial products and its ability to operate its business without infringing the intellectual property rights of others; (xi) parties from whom the Company licenses its intellectual property defaulting in their obligations to the Company; (xii) estimates of the Company’s expenses, future revenues, capital requirements and needs for additional financing; (xiii) the effect of patients suffering adverse events using investigative drugs under the Company’s Expanded Access Program; and (xiv) competition from other companies and technologies within the Company’s industry. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company’s filings with the Securities and Exchange Commission (SEC), including the Company’s Annual Report on Form 20-F filed with the SEC on March 18, 2021. All forward-looking statements included in this press release are made only as of the date of this press release. The Company assumes no obligation to update any written or oral forward-looking statement, whether as a result of new information, future events or otherwise unless required by law.

 

Company contact:

Adi Frish

Chief Corporate & Business Development Officer

RedHill Biopharma

+972-54-6543-112

adi@redhillbio.com

Media contacts:

U.S.: Bryan Gibbs, Finn Partners

+1 212 529 2236

bryan.gibbs@finnpartners.com

UK: Amber Fennell, Consilium

+44 (0) 7739 658 783  

fennell@consilium-comms.com

 

[1] Opaganib is an investigational new drug, not available for commercial distribution.

[2] Opaganib, an Oral Sphingosine Kinase-2 (SK2) Inhibitor in COVID-19 Pneumonia: A Randomized, Double-blind, Placebo-controlled Phase 2A Study, in Adult Subjects Hospitalized with SARS-CoV-2 Positive Pneumonia (NCT: 04414618). K. L. Winthrop, A. W. Skolnick, A. M. Rafiq, S. H. Beegle, J. Suszanski, G. Koehne, O.Barnett-Griness, A. Bibliowicz, R. Fathi, P. Anderson, G. Raday, G. Eagle, V. Katz Ben-Yair, H. S. Minkowitz, M. L. Levitt, M. S. Gordon

[3] Based on preliminary blinded blended data from 463 patients. The Company did not conduct a head-to-head comparison study in the same patient population. The theoretical comparison between the global Phase 2/3 study with opaganib and reported rates of mortality from large platform studies such as RECOVERY, and other studies in similar patient populations, serves as a general benchmark and should not be construed as a direct and/or applicable comparison as if the Company conducted a head-to-head comparison study.

[4] Xia C. et al. Transient inhibition of sphingosine kinases confers protection to influenza A virus infected mice. Antiviral Res. 2018 Oct; 158:171-177. Ebenezer DL et al. Pseudomonas aeruginosa stimulates nuclear sphingosine-1-phosphate generation and epigenetic regulation of lung inflammatory injury. Thorax. 2019 Jun;74(6):579-591.

[5] Full prescribing information for Movantik® (naloxegol) is available at: www.Movantik.com.  

[6] Full prescribing information for Talicia® (omeprazole magnesium, amoxicillin and rifabutin) is available at: www.Talicia.com.       

[7] Full prescribing information for Aemcolo® (rifamycin) is available at: www.Aemcolo.com.

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Press Release

Pandora Boosts Online Sales by Transforming Its Global Omnichannel e-Commerce with IBM Sterling Supply Chain Software

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Pandora, a leading designer, manufacturer and marketer of hand-finished jewelry, is using IBM Sterling Order Management for improved real-time inventory visibility. Photo courtesy Pandora.

One of the world’s largest jewelry brands by volume uses IBM Sterling Order Management on Cloud to revamp its fulfillment capabilities and customer experience

ARMONK, N.Y., June 21, 2021 /PRNewswire/ — IBM (NYSE: IBM) has worked with Pandora (NASDAQ: PNDORA), a leading designer, manufacturer and marketer of hand-finished jewelry, to help Pandora transform and scale its global omnichannel e-commerce capabilities with IBM Sterling Order Management. Pandora, one of the world’s largest jewelry brands, was able to double its online sales in 2020 and is now leading the jewelry industry with improved real-time inventory visibility to better manage growing demand.

Pandora, a leading designer, manufacturer and marketer of hand-finished jewelry, is using IBM Sterling Order Management for improved real-time inventory visibility. Photo courtesy Pandora.

Pandora’s focus on innovating new customer experiences included using IBM Sterling Order Management to help to increase the company’s supply chain resiliency and business agility, and better mitigate disruptions and risk. By automating more of their order orchestration across channels, they also have opportunity to improve the sustainability and resiliency of their supply chain operations with more efficient delivery.

“Over the past couple of years, Pandora has made significant investments in digital capabilities and data, and we have consolidated, simplified and modernized the technology stack to bring digital and store technology closer together and closer to the customer,” said Jim Cruickshank, VP of Digital Development & Retail Technology, Pandora. “Our mission is about creating a personal experience and we’ve instituted massive platform changes with IBM Sterling and Salesforce to enable new digital-first capabilities that are much more individualized, localized and connected across channels and markets.”

Pandora’s entry into e-commerce over the last six years most recently led them to consolidate legacy technologies while deploying the new order management solution across its key markets. Using IBM Sterling Order Management as its backend for omnichannel fulfillment and Salesforce Commerce Cloud for e-commerce, Pandora created a seamless shopping experience across channels. By automating order orchestration processes, store associates and virtual customer service representatives are able to have an end-to-end view across inventory, order and delivery status to help meet consumer expectations.

To support this ambitious objective, Pandora established a Digital Hub in Copenhagen, Denmark, with dedicated digital, data and tech teams that have played a vital role in the solution’s quick deployment entirely remotely. As the pandemic forced Pandora to temporarily close most of its 2,700 stores, the digital investments in supply chain efficiency helped fuel the company’s e-commerce success. In addition to some of the go-to fulfillment options many retailers offered such as buy online pickup in store (BOPIS) and endless aisle, Pandora also introduced more innovative approaches such as virtual queuing for stores and AR-based virtual trials of products to help drive more immersive customer engagement.

“The global disruption every industry experienced as all forms of commerce were severely impacted by the pandemic was especially challenging for organizations with disconnected distributed order management systems and limited scalability,” said Jordan Speer, Research Manager – Global Supply Chain, IDC Retail Insights. “This vulnerability created a push to more quickly advance technology adoption that helps retailers better respond to fluctuating consumer dynamics. To meet this changing demand, enterprises are looking to harness new tools to achieve increased levels of supply chain resilience and efficiency while also allowing for more virtual interactions.”

Pandora’s detailed view on order and order lines as well as near real-time inventory management helped to improve insights throughout their systems chain spanning warehouse management solutions, e-commerce and customer contact center. This was further enabled with increased automation from self-service capabilities and the use of chatbots aiding customer support functions as Pandora experienced a massive increase in order volumes.

“The lifeblood of the global economy, consumer behavior, has significantly shifted and will continue to evolve with businesses needing to quickly adapt to new preferences and needs. To address this shift, leading retailers like Pandora rely on innovation to increase their business agility by enabling and scaling sustainable supply chain operations using AI and cloud,” said Kareem Yusuf, General Manager, AI Applications and Blockchain, IBM. “Pandora’s experience shows that they can stay competitive as business and technology leaders are finding new ways to create differentiated customer experiences that protect their enterprises from disruptions to help mitigate risk and accelerate growth.”

To hear more about Pandora’s omnichannel experience using IBM Sterling Order Management view their THINK 2021 keynote detailing how they continue to execute on their strategic initiatives by navigating one of the world’s greatest supply chain disruption.

About Pandora

Pandora designs, manufactures and markets hand-finished jewelry made from high-quality materials at affordable prices. Pandora jewellery is sold in more than 100 countries through more than 6,700 points of sale, including around 2,700 concept stores.

Headquartered in Copenhagen, Denmark, Pandora employs 26,000 people worldwide and crafts its jewelry at two LEED certified facilities in Thailand using mainly recycled silver and gold. The company plans to be carbon neutral by 2025 and has joined the Science Based Targets initiative to reduce emissions across its full value chain. Pandora is listed on the Nasdaq Copenhagen stock exchange and generated sales of DKK 19.0 billion (EUR 2.5 billion) in 2020.

About IBM Sterling Supply Chain

IBM Sterling Supply Chain solutions empower IT and supply chain professionals with greater visibility, transparency and trust to proactively predict and mitigate disruption, improve B2B information flow, and optimize inventory utilization and fulfillment. Learn how our AI- and blockchain-enabled solutions help you build an intelligent, self-correcting supply chain at www.ibm.com/supply-chain.

Contacts:

Heli Koenkyto

Heli.Koenkyto@ibm.com

Erik Mason

erik.mason@ibm.com

IBM Corporation logo.

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