Air Canada’s goal is to maintain sustainable profitability after soaring back into the black in 2012, especially as the carrier faces rising competition from WestJet and its plans to enter the short-haul and trans-border market.
Air Canada reiterated a forecast that the cost of operating flights in 2013 will fall faster than originally predicted after business in the first quarter beat its expectations.
Adjusted costs per available seat mile will fall 0.5 percent to 1.5 percent this year, Montreal-based Air Canada said today in a statement, repeating a prediction from last month. The airline forecast on Feb. 7 that the costs would fall by no more than 1 percent. The first-quarter adjusted net loss narrowed to C$143 million ($141.5 million), or 52 cents a share, from C$162 million, or 58 cents, a year earlier.
Operations early this year were hampered as Air Canada experienced aircraft deicing service delays at Toronto Pearson International Airport, its main hub. Results included an impairment charge of C$24 million related to Airbus A340-300 aircraft, as well as an estimated C$10 million due to flight cancellations caused by “severe” weather and “operational challenges” at Air Canada’s major Canadian airport bases, the carrier said in a preliminary earnings report on April 22.
First-quarter operating revenue declined to C$2.95 billion from C$2.96 billion, the company said today.
Air Canada fell 0.4 percent to C$2.88 in Toronto yesterday. The stock has gained about 65 percent this year.
Editors: Tom Lavell and Robert Valpuesta.
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Photo credit: An Air Canada aircraft takes off after snowfall at Heathrow airport in London January 21, 2013. Neil Hall / Reuters