Azul S A : 1Q 2024 Financial Statements

Interim Condensed - ITR Individual and Consolidated 1Q2024

Azul S.A.

Contents
Declaration of the officers on the interim condensed individual and consolidated financial
statements	3
Declaration of the officers on the independent auditor's report	4
Summary report of the statutory audit committee	5
Independent auditor report	6
Statements of financial position	8
Statements of operations	10
Statements of comprehensive income	11
Statements of changes in equity	12
Statements of cash flows	13
Statements of value added	14
Notes to the interim condensed individual and consolidated financial statements	15

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AZUL S.A.

Declaration of the officers

March 31, 2024

Declaration of the officers on the interim condensed individual and consolidated financial statements

In accordance with item VI of article 27 of CVM Resolution No. 80, of March 29, 2022, the Board of Directors declares that it reviewed, discussed and agreed with the interim condensed individual and consolidated financial statements for the three months ended March 31, 2024.

Barueri, May 10, 2024.

John Peter Rodgerson

CEO

Alexandre Wagner Malfitani

Vice President of Finance and Investor Relations

Antonio Flavio Torres Martins Costa

Technical Vice President

Abhi Manoj Shah

Vice President of Revenue

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AZUL S.A.

Declaration of the officers

March 31, 2024

Directors' statement on the independent auditor's report

In accordance with item V of article 27 of CVM Resolution No. 80, of March 29, 2022, the Board of Directors declares that it reviewed, discussed and agreed with the opinion expressed in the independent auditor's report on the examination of the interim condensed individual and consolidated financial statements relating to for the three months ending March 31, 2024.

Barueri, May 10, 2024.

John Peter Rodgerson

CEO

Alexandre Wagner Malfitani

Vice President of Finance and Investor Relations

Antonio Flavio Torres Martins Costa

Technical Vice President

Abhi Manoj Shah

Vice President of Revenue

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AZUL S.A.

Summary report of the statutory audit committee

March 31, 2024

Opinion of the statutory audit committee

In compliance with the legal provisions, the Statutory Audit Committee reviewed the management report and the interim condensed individual and consolidated financial statements for the three months ended March 31, 2024. Based on this review and also considering the information and clarifications provided by the Company management and by Ernst & Young Auditores Independentes S/S.Ltda. during the three months , the Statutory Audit Committee expressed a favorable opinion on the management report and on the interim condensed individual and consolidated financial statements for the three months ended March 31, 2024, together with the independent auditor's report issued by Ernst & Young Auditores Independentes S/S.Ltda. recommending the Board of Directors to approve them.

Barueri, May 10, 2024.

Sergio Eraldo de Salles Pinto

Member, Coordinator of the Audit Committee and Financial Specialist

Gilberto Peralta

Member of the Audit Committee

Renata Faber Rocha Ribeiro

Member of the Audit Committee

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A free translation from Portuguese into English of Independent Auditor's Review Report on quarterly information prepared in Brazilian currency in accordance with NBC TG 21 and IAS 34 - Interim Financial Reporting, and with the rules issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of Quarterly Information (ITR)

Independent auditor's review report on quarterly information

To the

Shareholders, Board of Directors and Officers

Azul S.A.

Barueri - São Paulo

Introduction

We have reviewed the individual and consolidated interim financial information of Azul S.A. (Company) contained in the Quarterly Information Form (ITR) for the quarter ended March 31, 2024, which comprises the statement of financial position as at March 31, 2024 and the related statements of profit or loss, of comprehensive income, of changes in equity, and of cash flows for the three-month period then ended, and notes to the individual and consolidated interim financial information, including material accounting policies and other explanatory information.

Executive board's responsibility for the interim financial information

The executive board is responsible for preparation of the individual and consolidated interim financial information in accordance with NBC TG 21 and IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board (IASB), as well as for the fair presentation of this information in conformity with the rules issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of Quarterly Information (ITR). Our responsibility is to express a conclusion on this interim financial information based on our review.

Scope of review

We conducted our review in accordance with Brazilian and International Standards on Review Engagements (NBC TR 2410 and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with auditing standards and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion on the individual and consolidated interim financial information

Based on our review, nothing has come to our attention that causes us to believe that the individual and consolidated interim financial information included in the quarterly information referred to above was not prepared, in all material respects, in accordance with NBC TG 21 and IAS 34 applicable to the preparation of Quarterly Information (ITR), and presented consistently with the rules issued by the CVM.

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Other matters

Statements of value added

The quarterly information referred to above includes the individual and consolidated statements of value added (SVA) for the three-month period ended March 31, 2024, prepared under the responsibility of the Company's executive board, and presented as supplementary information for IAS 34 purposes. These statements were subject to review procedures conducted jointly with the review of the quarterly information for the purpose of concluding whether they are reconciled with the interim financial information and accounting records, as applicable, and whether their form and content are in accordance with the criteria defined in NBC TG 09 - Statement of Value Added. Based on our review, nothing has come to our attention that causes us to believe that these statements of value added were not prepared, in all material respects, pursuant to such standard and consistently with the individual and consolidated interim financial information taken as a whole.

São Paulo, May 10, 2024.

ERNST & YOUNG

Auditores Independentes S/S Ltda.

CRC SP-034519/O

Emerson Pompeu Bassetti

Accountant CRC SP-251558/O

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AZUL S.A.

Statement of financial position

March 31, 2024 and December 31, 2023 (In thousands of Brazilian reais - R$)

		Parent company	Consolidated
		March 31,	December 31,	March 31,	December 31,
Assets	Note	2024	2023	2024	2023
Current assets
Cash and cash equivalents	5	12,014	2,809	1,337,606	1,897,336
Accounts receivable	7	-	-	1,361,210	1,109,408
Aircraft sublease	8	-	-	15,057	14,592
Inventories	9	-	-	943,337	799,208
Deposits	10	8,052	7,802	503,156	515,692
Taxes recoverable	11	3,304	4,984	205,320	219,433
Derivative financial instruments	23	-	-	20,849	21,909
Related parties	29	518,379	216,388	-	-
Advances to suppliers	12	-	-	203,463	221,051
Other assets		238	2,079	273,158	245,518
Total current assets		541,987	234,062	4,863,156	5,044,147
Non-current assets
Long-term investments	6	-	-	791,545	780,312
Aircraft sublease	8	-	-	13,597	16,210
Deposits	10	-	70	1,966,840	1,777,803
Derivative financial instruments	23	-	-	56	-
Related parties	29	1,822,308	1,578,332	-	-
Other assets		-	-	311,241	143,781
Investments	14	760,040	760,782	-	-
Property and equipment	15	-	-	2,529,318	2,295,851
Right-of-use assets	16	-	-	8,941,011	9,011,558
Intangible assets	17	-	-	1,479,113	1,463,247
Total non-current assets		2,582,348	2,339,184	16,032,721	15,488,762
Total assets		3,124,335	2,573,246	20,895,877	20,532,909

The accompanying notes are an integral part of these interim condensed individual and consolidated financial statements.

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AZUL S.A.

Statement of financial position

March 31, 2024 and December 31, 2023 (In thousands of Brazilian reais - R$)

		Parent company	Consolidated
		March 31,	December 31,	March 31,	December 31,
Liabilities and equity	Note	2024	2023	2024	2023
Current liabilities
Loans and financing	18	-	-	1,245,705	1,100,051
Reverse factoring	22	-	-	117,276	290,847
Leases	19	428,538	216,388	3,662,173	3,687,392
Convertible debt instruments	20	63,218	25,807	63,218	25,807
Accounts payable	21	22,865	10,651	2,339,692	2,277,841
Airport taxes and fees	24	-	-	628,498	588,404
Air traffic liability and loyalty program	25	-	-	5,168,717	5,205,876
Salaries and benefits	26	9,280	2,344	490,320	474,797
Taxes payable	27	2,980	506	132,724	142,168
Derivative financial instruments	23	-	-	15,625	68,905
Provisions	28	-	-	399,147	736,430
Related parties	29	-	52,129	-	-
Other liabilities		-	-	148,755	150,362
Total current liabilities		526,881	307,825	14,411,850	14,748,880
Non-current liabilities
Loans and financing	18	245,554	-	9,884,104	8,598,861
Leases	19	1,634,241	1,443,351	11,654,910	11,459,019
Convertible debt instruments	20	1,070,272	1,175,803	1,070,272	1,175,803
Accounts payable	21	110,689	119,841	1,296,429	1,320,927
Airport taxes and fees	24	-	-	1,140,348	1,171,679
Taxes payable	27	-	-	100,867	112,287
Derivative financial instruments	23	-	-	76	840
Deferred income tax and social contribution	13	32,746	39,526	32,746	39,526
Provisions	28	25	30	2,846,750	2,404,423
Related parties	29	669,492	683,763	-	-
Provision for loss on investment	14	21,202,863	20,130,955	-	-
Other liabilities		-	-	825,953	828,512
Total non-current liabilities		24,965,882	23,593,269	28,852,455	27,111,877
Equity	30
Issued capital		2,315,610	2,314,821	2,315,610	2,314,821
Advance for future capital increase		18	789	18	789
Capital reserve		2,041,834	2,029,610	2,041,834	2,029,610
Treasury shares		(11,568)	(9,041)	(11,568)	(9,041)
Other comprehensive income		3,106	3,106	3,106	3,106
Accumulated losses		(26,717,428)	(25,667,133)	(26,717,428)	(25,667,133)
		(22,368,428)	(21,327,848)	(22,368,428)	(21,327,848)
Total liabilities and equity		3,124,335	2,573,246	20,895,877	20,532,909

The accompanying notes are an integral part of these interim condensed individual and consolidated financial statements.

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AZUL S.A.

Statement of operations

Three months ended March 31, 2024 and 2023

(In thousands of Brazilian reais - R$, except basic and diluted loss per share)

		Parent company	Consolidated
			Three months ended
		March 31,	March 31,	March 31,	March 31,
	Note	2024	2023	2024	2023
Passenger revenue		-	-	4,357,040	4,169,871
Other revenues		-	-	321,372	308,457
Total revenue	33	-	-	4,678,412	4,478,328
Cost of services	34	-	-	(3,435,097)	(3,894,824)
Gross profit		-	-	1,243,315	583,504
Selling expenses		-	-	(214,375)	(181,988)
Administrative expenses		(18,286)	(13,616)	(127,065)	(114,197)
Other expenses		(103)	-	(101,140)	(119,288)
	34	(18,389)	(13,616)	(442,580)	(415,473)
Equity	14	(1,084,891)	(604,295)	-	-
Operating (loss) profit		(1,103,280)	(617,911)	800,735	168,031
Financial income		290	1,727	44,924	53,466
Financial expenses		(64,189)	(62,024)	(1,223,923)	(1,257,584)
Derivative financial instruments, net		151,573	(81,039)	189,943	(274,972)
Foreign currency exchange, net		(41,469)	22,606	(868,754)	574,418
Financial result	35	46,205	(118,730)	(1,857,810)	(904,672)
Loss before IR and CSLL		(1,057,075)	(736,641)	(1,057,075)	(736,641)
Deferred income tax and social contribution	13	6,780	-	6,780	-
Net loss for the period		(1,050,295)	(736,641)	(1,050,295)	(736,641)
Basic loss per common share - R$	31	(0.04)	(0.03)	(0.04)	(0.03)
Diluted loss per common share - R$	31	(0.04)	(0.03)	(0.04)	(0.03)
Basic loss per preferred share - R$	31	(3.02)	(2.12)	(3.02)	(2.12)
Diluted loss per preferred share - R$	31	(3.02)	(2.12)	(3.02)	(2.12)

The accompanying notes are an integral part of these interim condensed individual and consolidated financial statements.

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