Company: CTTRF
Filing Date: 2025-04-30
Form Type: 20-F
Source: 0001292814-25-001765
Chunk: 145

Company: Controladora Vuela Compania de Aviacion, S.A.B. de C.V.
Filing Date: 2025-04-30
Form: 20-F
Item: Item 4A
Chunk 145
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 depreciation of right-of-use assets in 2023 was primarily attributed to the expansion
of our fleet, incorporating 13 new aircraft.

Salaries
and Benefits. The 36.6% increase in salaries and benefits in 2023 was primarily driven by the appreciation of the Mexican Peso,
and the annual rise in salaries compensation and higher variable compensation resulting from the performance-based structure for our workforce
due to increased operational activity. This increase was partially offset by a decrease in the total number of employees. See Item 6:
“ Directors, Senior Management and Employees - Employees.”

Sales,
Marketing and Distribution Expenses. The 34.6% increase in sales, marketing and distribution expenses in 2023 was primarily
driven by higher marketing expenses, sales commissions, and distribution expenses, aimed at bolstering our total operating revenue growth.
Furthermore, increased investments were directed towards marketing and distribution efforts to enhance the promotion of our other passenger
revenues and non-passenger revenues.

Maintenance
Expenses. The 0.7% increase in maintenance expenses in 2023 was driven by routine maintenance activities carried out during
the year attributable from higher average fleet size.

Aircraft
and Engine Variable Lease Expenses. The 16.6% decrease in aircraft and engine variable expenses in 2023 was primarily due to
lower redelivery costs resulting from the remeasurement of aircraft and engine lease extension agreements recorded during 2023.

Other
Operating Expenses. The 65.6% increase in other operating expenses in 2023 was primarily driven by administrative and operational
support expenses, accounting for 65% of this category. This increase includes higher travel and per diem expenses for our crew, as well
as a rise in technology and communication expenses compared to the previous year.

Depreciation and Amortization. The 37.8% increase
in depreciation and amortization in 2023 was primarily due to higher amortization of major maintenance events associated with the aging
of our fleet. The cost of these major maintenance events is accounted under the deferral method. In 2022 and 2023, we recorded amortization
of major maintenance lease hold improvements of U. S. $83.1 million and U. S. $114.9 million, respectively.

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Operating Results

2023 compared to 2024

                                            For the years ended December 31,                                            
                                                                        2023           2024      Variation              
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