Copa Holdings Reports Net Income of US$51.9 Million for the Fourth Quarter of 2008 and US$152.2 Million for Full Year 2008

PANAMA CITY, Feb. 19 /PRNewswire-FirstCall/ — Copa Holdings, S.A.
(NYSE: CPA), parent company of Copa Airlines and Aero Republica, today
announced financial results for the fourth quarter of 2008 (4Q08) and full
year 2008. The terms “Copa Holdings” or “the Company” refers to the
consolidated entity, whose operating subsidiaries are Copa Airlines and Aero
Republica. The following financial and operating information, unless otherwise
indicated, is presented in accordance with US GAAP. Unless otherwise stated,
all comparisons with prior periods refer to the fourth quarter of 2007 (4Q07).

OPERATING AND FINANCIAL HIGHLIGHTS

— Copa Holdings reported net income of US$51.9 million for 4Q08 or
diluted earnings per share (EPS) of US$1.20, as compared to net income of
US$35.5 million or diluted EPS of US$0.82 in 4Q07. Excluding special items,
which for 4Q08 include a US$12.2 million non-cash charge associated with the
mark-to-market of fuel hedge contracts, Copa Holdings would have reported an
adjusted net income of $64.1 million, or $1.48 per share. See the
accompanying reconciliation of non-GAAP financial information to GAAP
financial information included in financial tables section of this earnings
release.

— Net income for full year 2008 reached US$152.2 million or diluted EPS
of US$3.50, compared to US$161.8 million or diluted EPS of US$3.72 for full
year 2007. Excluding special items, which for 2008 include a US$20.2 million
non-cash charge associated with the mark-to-market of fuel hedge contracts,
Copa Holdings would have reported an adjusted net income of $172.4 million, or
$3.97 per share.

— The Company reported record operating income for 4Q08, reaching US$84.0
million, a 95.5% increase compared to operating income of US$43.0 million
recorded in 4Q07. Operating margin increased 9.2 percentage points, from 15.1%
in 4Q07 to 24.3% in 4Q08, mainly due higher unit revenues.

— The Company reported operating income of US$224.0 million for full year
2008, a 13.4% increase as compared to operating income of US$197.5 million in
2007. Operating margin for 2008 reached 17.4%, one of the best margins in the
airline industry.

— Total revenues for 4Q08 increased 21.6% to US$346.1 million. Yield per
passenger mile increased 6.0% to 18.5 cents and operating revenue per
available seat mile (RASM) increased 5.8% to 14.6 cents.

— For 4Q08 consolidated passenger traffic grew 15.5% while capacity
increased 15.0%. As a result, consolidated load factor for the quarter
increased 0.3 percentage points to 74.1%.

— Operating cost per available seat mile (CASM) decreased 5.7%, from 11.7
cents in 4Q07 to 11.0 cents in 4Q08. CASM, excluding fuel costs and special
items, decreased 5.4% from 7.6 cents in 4Q07 to 7.2 cents in 4Q08, mainly due
to lower average commissions.

— The Company ended the year with a strong cash position, totaling
US$408.1 million in cash, short term and long term investment, which represent
approximately 32% of last twelve months´ revenues. This figure includes
US$47.3 million in restricted cash, of which $39.7 million are collateral for
out-of-money hedge contracts related to future quarters. Additionally, the
company has committed lines of credit totaling $31.1 million.

— In 4Q08, Copa Airlines began service to three new destinations:
Oranjestad (Aruba), Valencia (Venezuela) and Santa Cruz (Bolivia). Copa
Airlines’ network currently serves 45 destinations in 24 countries in the
Americas — by far, the most extensive network for intra-Latin American
travel.

— During the fourth quarter, Copa Airlines took delivery of two Embraer-
190 aircraft. Copa Airlines ended the year with a fleet of 42 aircraft,
consisting of 27 Boeing 737 Next Generation aircraft and 15 Embraer-190
aircraft. Copa Holdings ended the year with a consolidated fleet of 55
aircraft.

    -- For 2008, Copa Airlines reported on-time performance of 87.5% and a
flight-completion factor of 99.6%, maintaining its position among the best in
the industry.  Additionally, Aero Republica's on-time performance came in at
84.2%, leading the Colombian market both in domestic and international on-time
performance.

    Consolidated Financial               Variance  Variance           Variance
    & Operating Highlights        4Q08   vs. 4Q07  vs. 3Q08  FY2008   vs. 2007

    RPMs (millions)              1,760      15.5%     -1.1%   6,717      14.6%
    ASMs (mm)                    2,375      15.0%      3.3%   8,845      11.7%
    Load Factor                   74.1%  0.3 p.p. -3.3 p.p.    75.9%  1.9 p.p.
    Yield                         18.5       6.0%     -0.3%    18.1       9.8%
    PRASM (cents)                 13.7       6.5%     -4.5%    13.8      12.7%
    RASM (cents)                  14.6       5.8%     -4.0%    14.6      12.3%
    CASM (cents)                  11.0      -5.7%    -13.1%    12.0      14.9%
    Adjusted CASM (cents) (1)     11.0      -3.1%    -13.1%    12.0      14.7%
    Adjusted CASM Excl. Fuel
     (cents) (1)                   7.2      -5.4%     -1.2%     7.5       4.6%
    Breakeven Load Factor         56.9% -4.1 p.p. -7.6 p.p.    63.0%  8.5 p.p.
    Operating Revenues (US$ mm)  346.1      21.6%     -0.8% 1,288.8      25.5%
    EBITDAR (US$ mm) (2)          94.0      30.2%     47.0%   301.0       2.4%
    Adjusted EBITDAR
     (US$ mm) (2)(3)             106.1      44.3%     33.7%   321.2      13.0%
    EBITDAR Margin (2)            27.1%  1.8 p.p.  8.8 p.p.    23.4% -5.3 p.p.
    Adjusted EBITDAR
     Margin (2)(3)                30.7%  4.8 p.p.  7.9 p.p.    24.9% -2.7 p.p.
    Operating Income (US$ mm)     84.0      95.5%     47.3%   224.0      13.4%
    Adjusted Operating Income
     (US$ mm)(1)                  84.0      70.5%     47.3%   224.0      13.8%
    Operating Margin              24.3%  9.2 p.p.  7.9 p.p.    17.4% -1.8 p.p.
    Adjusted Operating
     Margin (1)                   24.3%  7.0 p.p.  7.9 p.p.    17.4% -1.8 p.p.
    Net Income (US$ mm)           51.9      46.1%     71.1%   152.2      -6.0%
    Adjusted Net Income
     (US$ mm) (3)                 64.1      73.7%     39.8%   172.4      13.4%
    EPS - Basic (US$)             1.20      45.3%     71.1%    3.53      -6.5%
    Adjusted EPS - Basic
     (US$) (3)                    1.48      72.7%     39.8%    4.00      12.8%
    EPS - Diluted (US$)           1.20      46.1%     71.4%    3.50      -5.9%
    Adjusted EPS - Diluted
     (US$) (3)                    1.48      73.6%     40.1%    3.97      13.4%
    Weighted Avg. # of Shares
     - Basic (000)              43,195       0.6%      0.0%  43,143       0.5%
    Weighted Avg. # of  Shares
     - Diluted (000)            43,426       0.1%     -0.1%  43,440      -0.1%

    (1) Adjusted Operating Income and Adjusted CASM exclude for full year 2007
        a US$8.0 million pre-tax non-recurring gain related to insurance
        proceeds in excess of aircraft book value and special charges of
        US$6.3 million for 4Q07 and  US$7.3 million for full year 2007 related
        to the early termination of MD-80 aircraft leases as a result of Aero
        Republica's ongoing transition to an all EMBRAER-190 fleet.

    (2) EBITDAR means earnings before interest, taxes, depreciation,
        amortization and rent.

    (3) Adjusted EBITDAR, Adjusted Net Income and Adjusted EPS (Basic and
        Diluted):  a) Excludes for full year 2007 a US$8.0 million pre-tax
        non-recurring gain related to insurance proceeds in excess of aircraft
        book value and special charges of US$6.3 million for 4Q07 and
        US$7.3 million for full year 2007 related to the early termination of
        MD-80 aircraft leases as a result of Aero Republica's ongoing
        transition to an all EMBRAER-190 fleet and b) Excludes non-cash
        charges/gains associated with the mark-to-market of fuel hedges.

        Note:  Attached to this press release is a reconciliation of non-GAAP
        financial measures to the comparable US GAAP measures.

Full 4Q08 earnings release available to download on:
http://investor.shareholder.com/copa/results.cfm

    4Q08 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST
      Date:                 February 19, 2009
      Time:                 11:00 a.m. US EST (11:00 a.m. Panama Time)
      Conference Call:
      Telephone Number:     877-857-6173   (U.S. Domestic Callers)
                            719-325-4745   (International Callers)
      Webcast Link:         http://investor.shareholder.com/copa/events.cfm

About Copa Holdings

Copa Holdings, through its Copa Airlines and Aero Republica operating
subsidiaries, is a leading Latin American provider of passenger and cargo
service. Copa Airlines currently offers approximately 144 daily scheduled
flights to 45 destinations in 24 countries in North, Central and South America
and the Caribbean. In addition, Copa Airlines provides passengers with access
to flights to more than 120 other international destinations through code
share agreements with Continental Airlines and other airlines. Aero Republica,
the second-largest domestic carrier in Colombia, provides service to 12 cities
in Colombia as well as international connectivity with Copa Airlines’ Hub of
the Americas through flights from Bogota, Bucaramanga, Cali, Cartagena,
Medellin and Pereira. Additionally, in May 2008 Aero Republica increased
international service by launching direct daily flights to Caracas, Venezuela
from the cities of Bogota and Medellin.

This release includes “forward-looking statements” within the meaning of
the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are based on current plans, estimates and expectations, and are not
guarantees of future performance. They are based on management’s expectations
that involve a number of business risks and uncertainties, any of which could
cause actual results to differ materially from those expressed in or implied
by the forward-looking statements. The Company undertakes no obligation to
update or revise any forward-looking statement. The risks and uncertainties
relating to the forward-looking statements in this release are among those
disclosed in Copa Holdings’ filed disclosure documents and are, therefore,
subject to change without prior notice.

Copa Holdings, S.A.

NON-GAAP FINANCIAL MEASURE RECONCILIATION

    This press release includes the following non GAAP financial measures:
Adjusted CASM, Adjusted CASM Excluding Fuel, Adjusted EBITDAR, Adjusted
Operating Income, Adjusted Net Income and Adjusted EPS.  This supplemental
information is presented because we believe they are useful indicators of our
operating performance and are useful in comparing our performance with other
companies in the airline industry. These measures should not be considered in
isolation, and should be considered together with comparable US GAAP measures,
in particular operating income and net income. The following is a
reconciliation of these non-GAAP financial measures to the comparable US GAAP
measures:

    Reconciliation of EBITDAR
    Excluding Special Items       4Q08     4Q07     3Q08      2008      2007

    Net income as Reported      $51,918  $35,526  $30,343  $152,191  $161,820

    Interest Expense            (10,891) (12,567) (10,385)  (42,071)  (44,332)
    Capitalized Interest            525      584      391     1,921     2,570
    Interest Income               2,863    3,361    2,903    11,130    12,193
    Income Taxes                 (9,253)  (5,058)  (1,745)  (18,609)  (17,106)
    EBIT                         68,674   49,206   39,179   199,820   208,495

    Depreciation and
     Amortization                11,326    9,821   11,132    42,891    35,328
    EBITDA                       80,000   59,027   50,311   242,711   243,823

    Aircraft Rent                10,078    9,692   10,245    43,008    38,636
    Other Rentals                 3,873    3,461    3,341    15,293    11,536
    EBITDAR                     $93,951  $72,180  $63,897  $301,013  $293,995

    Special Items (adjustments):
      Unrealized (gain) loss
       on fuel hedging
       instruments (1)           12,160   (4,932)  15,479    20,175    (9,095)
      Special Items (2)               -    6,300        -         -      (710)
    Adjusted EBITDAR           $106,112  $73,547  $79,376  $321,188  $284,191

    Reconciliation of
     Operating Income
     Excluding Special Items     4Q08     4Q07     3Q08      2008      2007

    Operating Income as
     Reported                   $84,047  $42,991  $57,073  $224,028  $197,509

    Special Items (adjustments):
      Special Items, net (2)          -    6,300        -         -      (710)
    Adjusted Operating Income   $84,047  $49,291  $57,073  $224,028  $196,799

    Reconciliation of Net
     Income Excluding Special
     Items                       4Q08     4Q07     3Q08      2008      2007

    Net income as Reported      $51,918  $35,526  $30,343  $152,191  $161,820

    Special Items (adjustments):
      Unrealized (gain) loss
       on fuel hedging
       instruments (1)           12,160   (4,932)  15,479    20,175    (9,095)
      Special Items, net (2)          -    6,300        -         -      (710)
    Adjusted Net Income         $64,078  $36,893  $45,822  $172,366  $152,016

    Shares used for Computation
     (in thousands)
       Basic                     43,195   42,985   43,195    43,143    42,908
       Diluted                   43,426   43,433   43,491    43,440    43,464

    Adjusted earnings per share
       Basic                       1.48     0.86     1.06      4.00      3.54
       Diluted                     1.48     0.85     1.05      3.97      3.50

    Reconciliation Operating
     Costs per ASM Excluding
     Fuel and Special Items        4Q08     4Q07     3Q08      2008      2007

    Operating Costs per ASM
     as Reported                   11.0     11.7     12.7      12.0      10.5
    Aircraft fuel per ASM           3.8      3.8      5.4       4.6       3.4
    Operating Costs per ASM
     excluding fuel                 7.2      7.9      7.3       7.5       7.1
    Special Items (adjustments):
       Special Items per ASM,
        net (2)                       -     (0.3)       -         -       0.0
    Operating expenses excluding
     fuel and special items         7.2      7.6      7.3       7.5       7.1

    FOOTNOTES:
    (1)  Include unrealized (gains) losses resulting from the mark-to-market
         accounting for changes in the fair value of fuel hedging instruments.
         For 4Q08, 3Q08 and full year 2008 the Company recorded unrealized
         fuel hedge losses of US$12.2 million, US$15.5 million and US$20.2
         million, respectively. For 4Q07 and full year 2007 the Company
         recorded unrealized fuel hedge gains of US$4.9 million and US$9.1
         million, respectively.

    (2)  Special items include for the 4Q07 period a US$6.3 million special
         charge related to the early termination of MD-80 aircraft leases, as
         a result of Aero Republica's ongoing transition to an all EMBRAER-190
         fleet. Special items include for full year 2007 include a US$8.0
         million non-recurring gain related to insurance proceeds in excess of
         aircraft book value and a US$7.3 million special charge related to
         the early termination of MD-80 aircraft leases, as a result of Aero
         Republica's ongoing transition to an all EMBRAER-190 fleet.

    CPA-G

SOURCE Copa Holdings, S.A.