Air Canada Posts Second Quarter Results

Air Canada today reported its second quarter 2023 financial results. With highlights including:

• Operating revenues of $5.427 billion increased 36% from the second quarter of 2022
• Operating income of $802 million, with an operating margin of 14.8%, compared to an operating loss of $253 million in the second quarter of 2022
• Adjusted EBITDA of $1.220 billion, with adjusted EBITDA margin of 22.5%, an improvement of over $1 billion from the second quarter of 2022
• Second quarter net cash flows from operating activities of $1.490 billion, and free cash flow of $965 million
• Leverage ratio of 1.7 at June 30, 2023, down from 3.2 at March 31, 2023

Michael Rousseau, President and Chief Executive Officer of Air Canada, said: “Air Canada’s second quarter results were driven by strong demand and show the effectiveness of our plan. As a result of the hard work of our people, the appeal of our growing global network, as well as our leading brand and product offering, operating revenues in the quarter reached $5.4 billion, an increase of 36% from a year ago. Operating income was $802 million, a year-over-year improvement of over $1 billion, and our adjusted EBITDA reached $1.2 billion with an adjusted EBITDA margin of 22.5%.”

Rousseau continued: “I thank the entire team for its continued dedication to serving our customers, including collaborating with our partners, who also share the responsibility of ensuring a smooth customer journey. We safely carried over 11 million customers across our global network in the quarter, a year-over-year increase of about 23%.”

“However,” Rousseau said that: “despite having more trained resources than last summer and improved tools, our operations in June and July were not at expected levels. We are increasing our efforts to protect the customer journey from disruption, regardless of the cause. This includes using any influence we have, in such instances as pilot attrition at our principal regional partner or global supply chain issues, or working to mitigate the effects of situations beyond our control, such as disruptive storm activity in our key hubs and markets. We are confident that our efforts will generate positive outcomes.”

Air Canada’s President and Chief Executive Officer noted that: “We are particularly pleased with our international performance, propelling nearly 70% of the year-over-year increase in passenger revenues. Air Canada Vacations continued to see high demand for leisure travel packages, and Aeroplan added compelling new partners and grew its membership. Our cargo business, like others in the industry, experienced lower demand and yields than expected. Based on current passenger booking patterns, we see prevailing strength in travel demand over the second half of 2023, giving us confidence to increase the lower end of our adjusted EBITDA guidance range.”

And Rousseau stated: “We continue to focus intently on cost discipline and liquidity management. We ended the quarter with more than $9.6 billion in cash, cash equivalents and investments. This will enable us to further invest in our business, deleverage our balance sheet and ensure our company maintains the resiliency and adaptability needed for long-term success and to navigate through evolving market conditions.”

Go to www.aircanada.com for more.