EVA AIR 2021 Investor Conference 2021.04.22
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EVA AIR
2021 Investor Conference
2021.04.22
Legal Disclaimer
• The information contained in this presentation, including all
forward-looking information, is subject to change without notice,
whether as a result of new information, further events or
otherwise, and EVA Airways (the “Company”) undertakes no
obligation to publicly update or revise the information contained
in this presentation.
• Investors should not regard the above forward-looking information
as legally binding but as information subject to change. No
guarantees regarding the completeness, accuracy, and reliability of
information contained are made explicitly or implicitly. They are
not intended to represent complete statement of the Company,
industry or future development.
2
Outline
• 2020 Financial Results
• Passenger and Cargo Operations
Operating Performance
Impact on the Industry
Outlook and Future Challenges
Measures Taken in Response to Covid-19
32020 Financial Results
4Operating Performance
Group Financial Statistics
2020 2019 YoY%
Group Operating Revenue NT$ Million 89,049 181,275 -50.9%
Net Operating Income (Loss) NT$ Million (827) 9,443 -
Profit (Loss) NT$ Million (3,277) 4,852 -
Group profit (loss) attributable to
NT$ Million (3,362) 3,982 -
owners of parent
Earnings (Loss) Per Share NT$ (0.69) 0.83 -
Group Financial Position
2020 2019 YoY%
Total assets NT$ Million 329,567 356,252 -7.5%
Total liabilities NT$ Million 252,908 278,110 -9.1%
Total equity NT$ Million 76,659 78,142 -1.9%
5Operating Performance
EVA Financial Statistics
2020 2019 %
Operating Revenue NT$ Million 79,603 135,621 -41.3%
Operating Income (Loss) NT$ Million (1,854) 6,117 -
Profit (Loss) NT$ Million (3,362) 3,982 -
Earnings (Loss) Per Share NT$ (0.69) 0.83 -
EVA Financial Position
2020 2019 YoY%
Total assets NT$ Million 302,237 321,863 -6.1%
Total liabilities NT$ Million 231,440 250,611 -7.6%
Total equity NT$ Million 70,797 71,252 -0.6%
6Operating Costs Analysis
Group EVA
2020 2019 2020 2019
100% 5% 5% 100% 5%
1%
8% Others
1% 1%
2% 2% 1%
6%
8% 9% 8% Commissions
8%
11%
16% Passenger service
30%
32%
19% Landing, parking
16%
50% 50% Depreciation and
15% amortization
23% 18%
25% Staff
8%
10% 10% Maintenance
30% Fuel
21% 23% 23%
0% 0%
Note: (1)Owing to Evergreen Aviation Technologies Corp., the consolidated subsidiary, transferred maintenance of
engine to GE Evergreen Engine Services Corp., the maintenance expenses decreased in 2020.
(2)Amid the COVID-19 outbreak, passenger service costs decreased due to reduced flying, and the decrease
in price of aircraft fuel led to the drop of fuel cost. Thus, compared to the year-ago period, staff cost,
depreciation and amortization expense are relatively higher.
7Operating Costs Analysis - Fuel Cost
Fuel expenditure
2020 2019 YoY%
Fuel average price(SIN JET) USD/BBL 46.72 76.69 -39%
Fuel consumption thousand/BBL 10,710 15,200 -30%
Fuel cost NT$ Million 17,266 38,703 -55%
Fuel hedging expenditure(profit) NT$ Million 1,523 (19) -
Total fuel cost NT$ Million 18,789 38,684 -51%
Fuel hedging coverage
Year % Coverage
2020 18.9%
2021 -
8Cash Flow Analysis
EVA Airways Corp.
2020 2019 YoY%
(NT$ Million)
Cash and cash equivalents at the beginning of year 41,856 39,931 5%
Net cash flows from operating activities (3,171) 29,835 -
Net cash flows from investing activities (6,643) (19,274) -66%
Net cash flows from financing activities (967) (8,636) -89%
Net increase (decrease) in cash and cash equivalents (10,781) 1,925 -
Cash and cash equivalents at the end of period 31,075 41,856 -26%
9Passenger and Cargo Operations
10Operating Performance-
Passenger and Cargo Revenue
NT$ 100M
Passenger and Cargo Revenue Trend, Year 2020-2021
107.8
100.0
80.0
52.3 57.7 56.9 57.7 59.0
60.0
48.0 49.1
46.2 42.0 44.5 42.7 42.8
41.6
40.0
26.9
19.2 26.3
20.0 17.7
8.7 9.0
3.7 4.3 5.7 8.2 7.0 6.5 6.8
4.5 5.0
5.9
0.0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2020 CGO Rev. 2021 CGO Rev. 2020 PAX Rev. 2021 PAX Rev.
Pandemic resurgences along with halted connection services have caused a sharp plunge in
passenger revenue in FEB2021 to a new low of NT$370 million.
Improving cargo demand has resulted in a steady growth in both cargo volumes and rates, thus
cargo revenue in 2021Q1 has risen by 138% YoY.
11Operating Performance-
Passenger Revenue by Region (1)
12Operating Performance-
Passenger Revenue by Region (2)
13Operating Performance-
Cargo Revenue by Region (1)
14Operating Performance-
Cargo Revenue by Region (2)
15Impact on the Industry (1)
Drastic slump in passenger demand and stagnated recovery globally
1. 2021 is shaping up to be a much tougher year than previously expected, with
global passenger demand estimated to be 38% of 2019.
2. Patchy rollout of vaccines along with stringent border restrictions have stalled
passenger demand recovery worldwide.
In 2020, cargo performance started off on a weaker tone but
rebounded rapidly and remained a bright spot for the industry
1. Global AFTK for 2020 was down by 24% YoY, FTK was down by 12% YoY.
2. Global FTK for 2021 has not only recovered but also surpassed 2019 level, and
growth rates in January and February were 1% and 9% YoY respectively.
16Impact on the Industry (2)
Revenue and Cash Flow
1. The latest estimation of global cash burn for the industry has nearly doubled
from the original 48 billion USD to 75-95 billion USD.
2. The airline industry is expected to be cash negative until 2022.
Difficult and disruptive business environment
1. Tough aircrew quarantine rules restricted fleet deployment and limited air
capacity.
2. Surging jet fuel prices put increased pressure on operating costs.
17Outlook and Future Challenges-
Passenger Operation (1)
Recovery in international air travel remains sluggish
1. The relaxation of border controls worldwide is slow-paced and uncertain.
2. Although nations have expanded their vaccination programs, the vaccination
rates outside of the UK and the US are not as high as expected.
The implementation of “Travel Bubble“ faces obstacles
1. Testing and stricter self-management hold passengers at bay.
2. Increased travel costs suppress market demand.
18Outlook and Future Challenges-
Passenger Operation (2)
Travel demand will rebound in the short term, and gradually increase
in the long term
1. VFR and leisure travel demand will rebound significantly in the short term
once the pandemic ceases.
2. The time span for passenger demand to recover to pre-pandemic level is
around 3-4 years, but long-term growth can be expected.
The development and application of “Health Passport”
1. The aviation industry actively supports and promotes health passports.
2. Consensus are still underway among nations and international associations.
19Measures Taken in Response to Covid-19
Passenger Operation (1)
Maintaining a “bare skeleton” network
1. Operate skeleton global network in accordance to current regulations and
market demand.
2. Gradually ramp up capacity and flight frequencies in line with market recovery.
Resume connection services
As transfer restrictions loosen, EVA will restore hub network and improve
connection services to attract more transfer passengers.
20Measures Taken in Response to Covid-19
Passenger Operation (2)
Moderate growth for future fleet planning
1. Scale down new aircraft deliveries and defer delivery schedule.
2. Terminate expired leases and suspend renewals or new lease contracts.
Facilitate contactless automated services
1. Promote pre-check in services and enhance existing self-check in services.
2. Cooperate with airports worldwide to promote biometric boarding services.
21Outlook and Future Challenges-
Cargo Operation (1)
Global economic recovery can be anticipated, and cargo demand
remains strong
1. As optimism in global manufacturing PMI rises, the IMF expects the world
economy to grow by 6.0% in 2021.
2. As inventory replenishment cycle speeds up, cargo demand is further driven
up.
3. U.S. relief packages and infrastructure plans will push demand for goods and
raw materials.
4. Air freight rate and demand are still on the rise, driven by port congestion in
Europe and America.
22Outlook and Future Challenges-
Cargo Operation (2)
The emergence of stay-at-home economy and e-commerce
1. Business opportunities derived from stay-at-home economy and remote
working continue to thrive.
2. Sales revenue of booming global e-commerce amounted to US$4.5 trillion in
2021.
Changes are occurring in the industry supply chain
1. Geopolitics are reshuffling supply chains and affecting cargo networking.
2. Recovery of air passenger traffic results in the growth of passenger fleet belly
space, lowering yields.
23Measures Taken in Response to Covid-19
Cargo Operation (1)
Optimizing fleet utilization
1. Utilizing more “preighter flights (passenger-cargo flights)” to optimize EVA
cargo service network.
2. Increase long-haul frequency of cargo fleet to improve performance.
Enhance air cargo operation via “preighter flights”
1. To increase preighter flight frequency.
2. To optimize the utilization of preighter cabin space for further enhancement
in cargo capacity.
24Measures Taken in Response to Covid-19
Cargo Operation (2)
Swap order to freighter and expedite delivery
1. Three new 777 freighters will be delivered by Q1/2022.
2. Negotiations for an earlier delivery schedule are still ongoing.
Strengthen cargo business management
1. Smart space allocation and rate management will enhance operation revenue.
2. The creation of new high-yield products (e.g. space block and charter flights)
can generate and capture potential demand.
25Q&A 26
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