Republic Airways prices offering; GOL misses analyst expectations
Republic Airways Holdings (+3.7%) was among the few North and South American airlines that gained on Friday (12-Nov-2010) after announcing the pricing of the public offering of 12 million shares of its common stock at USD7.80 per share. In addition, the underwriters have an option for 30 days to purchase up to 1.8 million additional shares of common stock on the same terms and conditions.
- Republic Airways Holdings announces public offering of common stock, leading to a gain in share price.
- Copa Airlines reports a significant increase in net income for Q3 2010, resulting in a rise in share price.
- GOL fails to meet analyst expectations for Q3 2010 earnings, causing a slight decline in share price.
- Atlas Air and US Airways experience a decrease in share price, contributing to the overall decline in the market.
- Republic Airways intends to use the proceeds from the offering to finance aircraft orders and enhance liquidity.
- Goldman Sachs and Deutsche Bank Securities act as joint book-running managers for Republic Airways' public offering.
Assuming no exercise of the underwriters' option to purchase additional shares, the company expects to receive net proceeds from this offering of approximately USD88.5 million after deducting underwriting discounts and commissions and estimated expenses of the offering. The company intends to use the net proceeds from the offering for general corporate purposes, including to finance a portion of its new Embraer E190 aircraft order and bolster its liquidity. Goldman, Sachs & Co and Deutsche Bank Securities Inc are acting as joint book-running managers for the offering.
See related CAPA Profile: Privatisation and Ownership
Copa Airlines (+6.1%) also rose for the day, after announcing a 48.2% year-on-year rise in net income for 3Q2010 to USD63.9 million, the day before. WestJet (+1.0%) and Alaska Air (+0.3%) were the only other carriers to gain for the session.
GOL reports 41.2% rise in net profit
GOL (-0.5%) slipped after failing to meet analyst expectations for its 3Q2010 earnings. The LCC reported a 41.2% year-on-year rise in net income for the three months ended 30-Sep-2010 to BRL110 million (USD64 million). The result was on a 19.5% improvement in net revenue to BRL1788.9 million (USD1040 million). Operating income was also up for the period, rising 88.9% to BRL187.2 million (USD108.9 million).
According to Bloomberg, analysts had on average expected GOL to report a profit excluding some items of BRL123.6 million.
See related CAPA Profile: Financial Results
Elsewhere, Atlas Air (-3.7%) and US Airways (-1.8%) led the majority of carriers lower for the day.
North & South America selected airlines daily share price movements (% change): 12-Nov-2010
Source: Centre for Asia Pacific Aviation & Yahoo! Finance