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Canada : Air Canada Reports Record Second Quarter 2017 Results.

Air Canada today reported record second quarter 2017 EBITDAR (earnings before interest, taxes, depreciation, amortization, impairment and aircraft rent) of $670 million compared to the previous record second quarter 2016 EBITDAR of $605 million, an increase of $65 million and consistent with the forecast in Air Canada's July 6th, 2017 news release. The airline recorded a second quarter EBITDAR margin of 17.1 per cent. On a GAAP basis, Air Canada reported second quarter operating income of $281 million versus operating income of $277 million in the second quarter of 2016.

Air Canada recorded adjusted net income of $215 million or $0.78 per diluted share in the second quarter of 2017 compared to adjusted net income of $203 million or $0.72 per diluted share in the second quarter of 2016. The airline reported record second quarter net income of $300 million or $1.08 per diluted share compared to net income of $186 million or $0.66 per diluted share in the second quarter of 2016.

"I am pleased to report that, in our second quarter, we delivered record operating revenues, record EBITDAR and ended with record liquidity levels, exceeding last year's financial results and analysts' consensus estimates for EBITDAR. We also improved our guidance for key financial measures, including a significant improvement in projected free cash flow for 2017," said Calin Rovinescu, President and Chief Executive Officer.

"Moreover, we delivered an excellent unit cost performance and our unit revenue, on a stage-length adjusted basis, increased 1.6 per cent versus last year's quarter. These are important drivers of margin expansion and are the result of the successful execution of our business plan.

"With the launch of 16 international and U.S. transborder routes this quarter alone, we continue to increase international-to-international connecting passengers via Canada. On June 29th, we served close to 167,000 customers, setting an all-time record which we expect to surpass during the upcoming August long weekend. Demand continues to be robust in a stable fuel and pricing environment as we move into what has historically been our most important quarter given the travel demands and patterns of our North American customers. In 2018, capacity growth, driven by our wide-body fleet expansion, will begin to slow as we shift our focus to our mainline narrow-body fleet replacement program which is expected to further reduce our unit costs and improve operating margins.

"I would like to thank our growing customer base who are increasingly choosing Air Canada for convenience, value and comfort. Our achievements are a tribute to our team of 30,000 employees whose dedication and professionalism have been instrumental in Air Canada being named Best Airline in North America in a survey of almost 20 million air travellers by Skytrax, the global benchmark of industry excellence. Also in the quarter, Air Canada was recipient of this year's Airline Strategy Award by Flight Airline Business for its successful financial turnaround allowing for significant investments in, among other things, improvements in the customer experience and environmental initiatives. These recognitions, joining others citing Air Canada as one of Canada's top diversity employers and one of North America's most engaged workplaces, are testament to the team's hard work as we evolve into a global champion," concluded Mr. Rovinescu.

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Publication:Mena Report
Article Type:Financial report
Date:Aug 2, 2017
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