Company: CTTRF
Filing Date: 2025-04-30
Form Type: 20-F
Source: 0001292814-25-001765
Chunk: 305

Company: Controladora Vuela Compania de Aviacion, S.A.B. de C.V.
Filing Date: 2025-04-30
Form: 20-F
Item: Item 19
Chunk 305
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 any segments flown by another airline.

Non-passenger revenues

The most significant non-passenger revenues include: (i) revenues
from other non-passenger services described below and (ii) cargo services.

Revenues from other non-passenger services mainly include,
but are not limited to, commissions charged to third parties for the sale of trip insurance and other services. These, as well as
cargo services, are recognized as revenue at the time the service is provided.

The Company also evaluates, in each new transaction where
applicable, the principal versus agent considerations concerning certain non-air travel service arrangements with third-party providers.
When the Company determines that the underlying services are provided through third parties who are primarily responsible for providing
the services, revenue for these specific non-air travel services is presented on a net basis (agent).

Code-share agreement

On January 16, 2018, the Company and Frontier entered into
a code-share operations agreement, which started operations in September 2018.

Through this alliance, the Company’s customers gain
access to additional cities in the U. S. beyond the current available destinations as the Company’s customers are able to buy a ticket
throughout any of Frontier’s actual destinations, and Frontier customers gain first-time access to new destinations in Mexico through
Volaris’s presence in Mexican airports.

Code-share tickets can be purchased directly from the Volaris
website. The airline that provides the transportation recognizes the revenue when the service is provided to the customer.

Other considerations analyzed as part of revenue from contracts
with customers

All services provided by the Company including sales of tickets
for future flights, other passenger-related services and non-passenger services must be paid through a full cash settlement. The payment
of the transaction price is equal to the cash settlement from the client at the sales time (using different payment options like credit
or debit cards, paying through a third party or directly at the counter in cash). There is little or no judgment to determine the point
in time of the revenue recognition, and the amount of it. Even if mainly all the sales of services are initially recognized as contract
liabilities, there is no financing component in these transactions.

The cost to obtain a contract is represented by the commissions
paid to the travel agencies and the bank commissions charged by the financial institutions for processing electronic transactions (Note
10). The Company does not incur any additional costs to obtain and fulfill a contract that is eligible for capitalization.

Trade receivables are mainly with financial institutions due
to transactions