Ladies and gentlemen, thank you for standing by. Welcome to the Copa Holdings Second Quarter Earnings Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. At that time, if you have a question, you will need to press Star, one, ne on your telephone. As a reminder, this call is being webcast and recorded, August 7th, 2025. I will now turn the conference call over to Daniel Tapia, Director of Investor Relations. Sir, you may begin. Thank you, James, and welcome everyone to our second quarter earnings call. Joining me today are Pedro Heilbron, CEO of Copa Holdings, and Peter Donkersloot, our CFO. Pedro will begin with an overview of our second quarter highlights, followed by Peter, who will walk us through the financial results. After that, we'll open the call for questions from analysts. Copa Holdings' financial reports have been prepared in accordance with the International Financial Reporting Standard. In today's call, we'll discuss non-IFRS financial measures, which are reconciled to IFRS measures in our earnings release available on our website, copaair.com. Our discussion today will also contain forward-looking statements, not limited to historical facts, that reflect the company's current beliefs, expectations, and/or intentions regarding future events and results. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially and are based on assumptions subject to change. Many of these are discussed in our annual report filed with the SEC. With that, I'll turn the call over to our CEO, Mr. Pedro Heilbron. Thank you, Daniel. Good morning, everyone, and thank you for joining us. I'd like to begin by recognizing the outstanding efforts of our entire team. Their dedication and professionalism continue to be key behind Copa's success and our ability to deliver strong results quarter after quarter. We're pleased to report another strong quarter with a 21% operating margin and a 17.7% net margin, both among the best in the industry. These results underscore the strength and resilience of our business model, which, combined with Copa's disciplined execution and cost leadership, enable us to consistently deliver industry-leading margins and solid financial results. Now, I'll go over the key highlights for the quarter. Capacity increased by 5.8% year-over-year. Load factor reached 87.3%, an increase of 0.5 percentage points compared to Q2 2024. Passenger yields came in 4.1% lower year-over-year. Unit revenues, or RASM, declined 2.8% to $0.107. Unit cost, or CASM, decreased 4.6% to $0.085, while CASM, excluding fuel, increased 3.2% to $0.058. Operationally, Copa Airlines once again delivered a world-leading on-time performance of 91.5% and a flight completion factor of 99.8%. Furthermore, Copa Airlines was recently recognized by Skytrax for the 10th consecutive year as the best airline in Central America and the Caribbean and received the award for Best Airline Staff in Central America and the Caribbean. I would like to take this opportunity to congratulate our more than 8,500 dedicated coworkers, whose commitment to excellence enables us to consistently deliver a world-class travel experience to our passengers. In terms of our network, we continue to expand our hub of the Americas in Panama with new service to San Diego, California, and we restarted flights to Caracas. Further, we recently announced plans to start service at the end of the year to Los Cabos, Mexico, and Puerto Plata, Dominican Republic, as well as restart flights to Santiago de los Caballeros, also in the Dominican Republic, and Salvador Bahia in Brazil. Together with our earlier announcements of service to Salta and Tucumán in Argentina in September, this brings to eight the total number of new and returning destinations announced so far this year, further strengthening our position as the most complete and convenient connecting hub for travel in the Americas. Going forward, we continue to see a healthy demand environment and remain focused on our competitive advantages: the best geographic position with our hub of the Americas in Panama, low unit cost and a strong balance sheet, and a passenger-friendly product with the best on-time performance. These pillars continue to drive our ability to consistently deliver industry-leading results. With that, I'll turn the call over to Peter, who will go over our financials in more detail. Thank you, Pedro. Good morning, everyone, and thank you for joining our call today. I'd like to begin by echoing Pedro's appreciation for our team's continued commitment to delivering industry-leading results. For the second quarter, we delivered a net profit of $149 million, or $3.61 per share, a 25% year-over-year increase in earnings per share. Operating income reached $177 million and an industry-leading operating margin of 21%, highlighting our ability to consistently generate strong profitability. On the cost side, CASM decreased 4.6% year-over-year to $0.085, driven primarily by a 17% reduction in the average fuel price per gallon. CASM ex-fuel came in at $0.058, an increase of 3.2% compared to the second quarter of 2024 that is consistent with our target for the year. This increase was mainly due to the non-recurrent benefit recorded in the second quarter of 2023 in the maintenance, materials, and repair cost line, associated with the return conditions of nine aircraft lease extensions. This was partially offset by the decline in sales and distribution expense, driven by the continued successful execution of our NDC strategy and a reduction in passenger service cost, which reflects the year-over-year impact of the MAX 9 grounding in 2024. On the balance sheet front, we ended the quarter with $1.4 billion in cash, short-term and long-term investments, representing 39% of last 12-month revenue. This figure excludes over $600 million in pre-delivery deposits for future aircraft. Additionally, we currently have 42 unencumbered aircraft accounting for more than a third of our fleet, further reinforcing our financial flexibility. Total debt stood at $2.1 billion, entirely related to aircraft financing. Our adjusted net debt-to-EBITDA ratio remained at under 3.8x, and our average cost of debt continues to be highly competitive at 3.5%. With regards to the return of value to our shareholders, I'm pleased to announce that the company will make its third dividend payment of the year of $1.61 per share on September 15 to all shareholders of record as of August 29th. Regarding our fleet, during the quarter, we took delivery of three Boeing 737 MAX 8 aircraft, bringing our total fleet to 115 aircraft. We remain on track to end 2025 with a fleet of 125 aircraft, and I'm pleased to share that we have secured financing for all of our 2025 deliveries. As for our 2025 outlook, we are reaffirming our full-year operating margin guidance of 21%- 23%, supported by a healthy demand environment and continued cost discipline. We also maintain our expectation for capacity growth in ASMs in the range of 7%- 8% year-over-year. Our outlook is based on the following assumptions: load factor of approximately 87%, RASM of approximately $0.112, ex-fuel CASM of approximately $0.058, and an all-in fuel price of $2.45 per gallon. To finalize, we remain confident that our proven business model, robust balance sheet, and disciplined execution give us a solid foundation to continue delivering consistent growth, strong financial results, and industry-leading margins. Thank you, and we'll now open the call for questions from the analysts. Thank you, and at this time, we will conduct the question-and-answer session. As a reminder, to ask a question, you will need to press Star, one, one on your telephone and wait for your name to be announced. To withdraw your question, please press Star, one, one again. Please stand by while we compile the roster. Our first question comes from Savi Syth from Raymond James. Go ahead, Savi. Hey, good morning. Good morning, everyone. Morning. I know Pedro, I know you mentioned the healthy demand environment, but I was wondering if you could talk a little bit about what you're seeing in some of your biggest point-of-sale markets and if there's any demand trends that stand out, good or bad, in any of the particular markets or even passenger segments? Yeah, hi, Savi. In terms of load, if we think of load factors, we're increasing our load factor guidance, and most markets have strong demand or at least steady demand. In some cases, yields are slightly down. Industry capacity in our region for the second half of the year, and industry includes all of us, of course, is growing in the high single digit, but we're still keeping up with load factors, and again, as mentioned, increasing our guidance there. That applies to most all of the markets we're serving. Got it. That's helpful. I don't know if this is for Peter or for you, Pedro, but curious, you know, if you could share what you're seeing from Boeing. It seems like the aircraft are coming on time or early, and just any early thoughts into kind of 2026 capacity? Our deliveries this year have been early. Every plane has come a week or two before what was projected or scheduled. Of course, everything is delayed if we go back to the original date, but they're delivering on time this year. As Peter mentioned, we've received three aircraft so far, so the other 10 are going to come in the last five months of the year. Next year, we have six deliveries, which will happen earlier. Most are in the first half of the year. We should expect that the bulk of the ASMs that we're going to have this year are going to have a greater full-year impact in 2026, plus the six additional planes next year. Capacity, we're not guiding for 2026 yet, but it would be trending a little bit higher than this year. That's helpful. Thank you. Thank you. Our next question comes to the line of Duane Pfennigwerth from Evercore ISI. Hey, good morning. Maybe you could just remind us on FX what the impacts are from a top-line perspective, from a yield perspective, and from a CASM perspective when we get, you know, a slightly weaker dollar. Maybe you could just remind us of that and any trends to call out in local currencies that you're seeing. Yeah. Most of the major currencies in South America and in Latin America, including Mexico too, are up year over year and also up in the last six months and since the last quarter. You could call it weakness of the U.S. dollar, or it doesn't really matter much. Most of our sales are south to north, so originating in the south. We tend to benefit when the currencies in Latin America are stronger, like the case now. It's not a significant difference year over year. I mean, they're slightly up. It's good. That's positive. I wouldn't say that it's significant enough to make a huge difference. I would add on the cost side, most of our costs are U.S. dollar based. We have our main cost base in Panama, where we have fuel and all our salaries in U.S. dollar based, or most of our salaries in U.S. dollar based. That won't necessarily affect us on the FX side in cost. Got it. Just for my follow-up, it's been a while since we've talked about it, but maybe just an update on airport capacity at PTY any infrastructure projects that may be going on, and you know, is there sufficient runway to support your growth plans, you know, 2026, 2027, and beyond? What's the next kind of marker we should be looking at there? Thank you. Yeah, definitely. The airport actually is right now working on an expansion plan, which includes work on both runways, repair work, but one runway will be extended, 03 Left. It also includes improvement to the taxiway and between 10 and 12 additional gates to the new T2. This should all happen in the next three to four years. There's already, let's say, pre-work or pre-plan by an international consultant. They have the funds earmarked for this project and are working closely with the airlines and civil aviation. We see this moving ahead, and it's going to give the airport, I think, a lot of another 10 years at least of runway. Okay, thank you. Congrats on the strong results. Thank you, Daune. Our next question comes from Guilherme Mendes from JPMorgan. Your line is open. Hey, everybody. Pedro, Peter, Daniel, thanks for taking my question. The first one is looking into 2026. I will assume that the industry continues to grow, let's say, by mid to high single digits into next year. Is it fair to assume that yields can remain pretty much where they are right now? The second point to Peter, it's on the buybacks. If you can update us on how much you have executed in the second quarter of the year and how much is left out of the $200 million. Thank you. Yeah. I'll take your first question. So far, demand has been holding up, even though capacity has grown quite a bit in the last few years. I should also mention that our yields and RASM have come down. It's been lower in 2025 versus 2024, and it was lower in 2024 than in 2023. We've seen yields come down as demand has grown in our region. At the same time, we have lowered our unit cost and made up for most of that. We've been preparing for a long time, since 10 years ago, and especially after the pandemic, to deliver strong results in a lower yield environment. That's why we've been so focused on efficiencies and costs. We have accomplished many of our goals, and we're not stopping there. We're confident that we can be successful even on, let's say, flat yields like we're seeing right now or even lower yields. Hello, Guilherme. This is Peter here. On the buybacks, as you stated, the board has approved a $200 million program, and we have executed to date around half of that program, including around $10 million that we have executed year to date. Okay. Very clear. Thank you both. Our next question comes from Jens Spiess from Morgan Stanley. Hello. Thank you for taking my questions and congrats on the solid results. I just want to ask, on your cargo business, which is continuing to do quite well, how do you see things going forward? Do you see any slowdown in volumes due to the higher tariffs in general, like tensions across the region? In reality, do you have visibility into that business, or is it very limited? How much in advance, basically, you have visibility? Thank you. Yeah, a few things. We do not have visibility in the long term. It's pretty much short term. I would also mention, yes, cargo has been very strong in Q2 and the first half of the year. Most of our cargo moves in the belly of our passenger aircraft. Let's call it low-risk cargo. It's not a bet we're making. It's very low risk, and it's making the best of all of our capacity. We also operate one cargo aircraft, which has done very, very well, a 737-800 freighter. We're bringing a second one this month. By the end of this month, we'll have a second 737-800 freighter. This one will be leased, an operating lease. That will also contribute to more cargo volume. Again, it will still be mostly moved in the belly of our passenger aircraft. Okay. Perfect. Assuming that demand remains healthy, how much should we expect in terms of an increase in cargo with a new freighter? Thank you. Nothing, nothing really. It's just a single 737-800 freighter. The change will not be significant. It's a bump up, but it should not move the needle in a significant way. Got it. All right. Thank you. Thank you. Our next question comes from Rogério Araújo from Bank of America. Yeah. Hi, guys. Morning. Congratulations on the results. I have a couple here. Number one, on fuel price, you are guiding, one of the assumptions for the guidance is $2.45 per gallon. We estimate this implies a price around 4% higher than the current curve indicates. Does that make sense? Is the jet fuel price assumed in the guidance somewhat conservative? In other words, if it remains as it is, could there be upside risks to the margin guidance? That's number one. Number two, moving now to the second half of the year, could you provide an early view on the expected trend on CASM ex-fuel looking ahead into 2026? You've talked already about capacity and potential RASM. Any relevant expected change in margin levels or any trend you're seeing, anything you could share with us would be great. Thank you. Okay. Hello Araújo, Peter here. I would start saying that the fuel curve that we embedded in our guidance is something that we don't update every day. When we built our guidance, the fuel was around the $2.45 that we embedded in our guidance. Today, it might be slightly lower, but we don't update our fuel curve every day. To the best of our knowledge, that's the one we use to build our guidance. On the CASM ex-fuel and guidance that we're seeing for the second half, I would say that we remain committed with the $5.80 for the full year, and we don't see any seasonality on the CASM ex-fuel. It should be pretty much flat across the fourth quarter. The fourth quarters. We don't see a lot of seasonality. We still don't provide any guidance for the CASM ex-fuel on 2026, but I can tell you that we're working on a lot of initiatives to, as it's part of our DNA, to always be very cost-driven and focused on our costs to make sure we maintain our absolute and our competitive advantage on absolute terms and on the relative terms on having a low CASM ex-fuel. On the RASM, I can actually tell you that we've been continuing seeing the similar trend that started in the second half of last year, and we expect our RASM for the second half of this year to be similar to the second half of last year. We see the trend to maintain similar with some markets behaving a little better, some markets are averaging around in the same neighborhood of second half last year. That will be flat year on year and in line with our guidance of 11.2%. Fair enough. Very clear. Thank you so much. Our next question comes from Michael Linenberg from Deutsche Bank. Oh, yeah. Hey, good morning, everyone, and you know, nice job this quarter. I want to go back to Savi's question just about, you know, demand strength and weakness across regions. We heard one of your competitors talk about Central America to the U.S. being pretty weak. I know it's not a market that you've historically been all that big in, but when I think about all the routes, you know, all the U.S. destinations, you're adding to Panama, I'm sure the utility of Central American passengers of that hub is going up. Also, domestic Colombia, because it looks like the domestic Colombia market is doing much better now. Sort of how that, you know, features into Wingo's results. Pedro, if you could go into a little bit more detail or color on that, that would be great. Yeah. Hi, Mike. We don't share a lot of specifics, but I can comment on the two markets that you're mentioning. Central America to the U.S. has received a lot of capacity in the past, let's say in the past two years. There's been a lot of growth in that market, and then we have the other issues, the immigration visa issues on top. Luckily, it's not a huge market for us. We don't fly nonstop Central America to the U.S. We connect through Panama, which is a little bit south of Central America. It's not huge. Yes, Central America is one of our weaker markets right now. I would validate that. Again, not the most important market for us in that sense, especially that flow. We're very strong Central America to South America, and we're very strong Central America to the Caribbean. To the U.S., that's not our number one strength. Yeah, domestic Colombia is doing well, and that has favored Wingo, no doubt. Great. My second question, Pedro, when I think about your positioning where you fly, there's not a lot of premium product offering. There may be one or two other carriers. You sort of stand head and shoulders above most of your competition. To sort of borrow from Delta, they look at premium plus ancillary, and they view that as their competitive moat. I think we're approaching 60% of their revenue falls into that premium ancillary bucket. As you build out cargo and you have a very meaningful premium product, you have lie-flat on your MAX 9s. Where is the premium ancillary percentage today, even in rough numbers? Where was that maybe five years ago? Aspirationally, where do you think you can take that? I truly believe that when we think about competitive moats, economic moats, that premium plus ancillary is something where you can shine. Thanks for taking my question. Yeah, thank you, Mike. You're totally right. We have a premium product advantage in our network, definitely. I'm talking mostly of this intra-regional, intra-Latin America narrow-body network where we compete and where we have a leadership position. We now have also a premium product advantage, which we're learning to monetize. I mean, we're doing much better in ancillary revenues, in premium ancillary revenues, like upgrades, for example, our frequent flyer program, seat premium economy, which we also have a nice premium economy across our fleet. Every year we're doing better than the previous year. We don't share specifics, but this year we're doing quite well, and we see a lot of upside, exactly in what you're saying for the reasons you're mentioning. Great. Thanks for taking my questions. Thank you, Mike. Our next question comes from Alberto Valerio from UBS. Hi. Morning, afternoon, and Peter, Pedro, thank you for taking my questions. I'd like you, if you can, talk a little bit about competition. You mentioned that some test masses and others a little bit better. Last time we spoke, we were talking about Argentina, maybe some new routes there. Brazil now with Azul in Chapter 11, LATAM with a moderate growth. If you could talk a little bit about competition and the last one about Volaris, the partnership that could share with Volaris, if you can provide some update on how it has been doing. Thank you very much. Okay. Thank you, Alberto. I will mention other lines. We don't give them free advertising, for sure. There has been a lot of capacity in our region, new capacity in the last two years, especially in the last two years, and including 2025. As I mentioned, the second half of the year, industry capacity is going to be up by about 9%. That includes Copa. Some airlines, which I will mention, have grown quite a bit. One in particular has grown a lot in our kind of markets in the intra-Latin America region. We've dealt with that successfully. Our load factors are up, and even though yields are slightly down, as we have shared throughout the presentation and in the earnings release, we have also lowered our unit cost. Of course, there's a good guy from fuel this year also. We have a very well-focused business model with the strongest product and better cost. We're in an excellent position to continue competing successfully. In terms of code share with Volaris, Mexico is, of course, one of the largest, I think it's like the third largest aviation market in all of the Americas, including the U.S. A very important market for us. We did not have a partner in Mexico. We now do with Volaris. It's a code share that will continue being developed and expanded. We hope it's going to be very beneficial for both airlines. In our case, tying that very significant Mexican market for our network, and then giving Volaris Mexico feed from our very strong South American, Central American, and Caribbean network. Perfect. Thank you very much. Thank you. Our final question comes from Tom Fitzgerald from TD Cowen. Thanks for the time. Just kind of going back to Mike's question, how do you view the role of technology or the role that technology can play in your revenue journey, and whether like dynamic pricing or better data analysis? Appreciate any color there. Yeah. A few things there. Since the pandemic, we have invested quite a bit in digital technology. A lot of it actually is homemade, which not only gives us the right digital technologies we need, but also at a much better cost, not on a per passenger or per booking basis. Like our internet booking engine, which now is where most of our sales come through, is Copa-owned, homemade. Our app, which is right now in some international contests competing as one of the five top apps in the world, going against really, really top airlines for the number one place, that's also homemade. That's allowing us to better develop our ancillary revenues. In terms of, let's say, more sophisticated technologies that will allow for dynamic pricing, we work with third-party providers. We work with some of the best third-party providers. I would say that we're in our infancy in terms of dynamic pricing and everything AI is going to provide for pricing in the future and revenue management. We're not super developed there, but we're going that way, always in a very cost-conscious, ROI-focused way, which is the Copa way. I appreciate that, Pedro. That's really helpful color. Just as a follow-up, would you mind reminding us where you are in your seat densification journey? Thanks again for the time, and congrats on the nice results. Thank you. We are not as advanced as where we should have been right now, and that's because of the delivery delays, which have made us postpone a little bit. We have, I think, a year to go. Out of our full fleet of 115 or so aircraft, we have 30 aircraft pending to take to 156 seats. We have 30 aircraft pending in our densification project. I should highlight that our densification project is not sacrificing any of the comfort product advantages we have. We're maintaining a full, comfortable, real business class with real business class seats of 16 passengers. We're maintaining our four rows of premium economy with 34 pitch, and then the rest of the cabin with very comfortable seats, recline, headrest, the whole thing. We're not sacrificing that. I am showing no further questions at this time. I would now like to turn it back to Pedro Heilbron for closing remarks. Okay. Thank you. Thank you, operator, and thank you, James. Thank you all for your questions and for participating in this call. We appreciate your continued interest and support, as always. Hopefully, very soon, we're going to be confirming an investor day date. It's going to be early, hopefully very early December in New York City. Stay tuned and have a great day. Thank you for participating in today's conference. This does conclude the program. You may now disconnect.