Transat A.T. Inc. reports Q4 2024 results

Transat A.T. Inc. has released its results for the fourth quarter that ended Oct. 31, 2024 which show a revenues and profitability increase for that period and a promising start for its Elevation Program.

Commenting on the results, Annick Guérard, President and Chief Executive Officer of Transat, said: “Transat closed fiscal 2024 on a positive note with adjusted EBITDA of $123.3 million in the fourth quarter mainly driven by higher traffic, lower fuel costs, and financial compensation from Pratt & Whitney related to grounded aircraft over the past two years. In addition, our results point to a more disciplined competitive environment as reflected by slightly better yields on a sequential basis.”

Guérard continued: “Looking ahead to fiscal 2025, we expect the industry to continue to favour a measured approach while maintaining relatively stable capacity. The decline in inflation and interest rates also suggests an increase in consumers’ discretionary spending. This situation should provide a suitable backdrop to deliver further yield improvements. However, we remain in a period of high economic uncertainty, leading us to exercise caution.”

Transat A.T. Inc.’s President and Chief Executive Officer noted that: “Our Elevation program, a comprehensive optimization plan aimed at maximizing long-term profitable growth, is progressing according to plan. At this stage, the initiatives implemented will contribute $25 million toward our goal of an annualized adjusted EBITDA improvement of $100 million. Initial significant impacts on our results are expected beginning in the second half of fiscal 2025.”

Jean-François Pruneau, Chief Financial Officer of Transat, said: “We improved our liquidity position through the sale and leaseback of four GTF2 engines from Pratt & Whitney, including three agreements that closed before the end of fiscal 2024. These transactions generated approximately $118 million in cash to strengthen our balance sheet. Finally, discussions with stakeholders and the review of all solutions to improve our capital structure continue and remain a priority for the organization.”

Fourth-quarter highlights include:

• Revenues of $788.8 million, up 3.2% from $764.5 million last year
• Adjusted EBITDA1 of $123.3 million, compared to $89.0 million last year
• Net income of $41.2 million ($1.05 per share), compared to $3.2 million ($0.08 per share) last year
• Negative free cash flow1 of $102.2 million, compared to $83.8 million last year
• Customer deposits of $781.2 million, up 3.6% from October 31, 2023
• Financial compensation agreement of $33.6 million with the equipment manufacturer of GTF2 engines to make up for the cost of aircraft grounded in 2023 and 2024
• Sale-leaseback transactions for three Pratt & Whitney GTF2 engines valued at $87.5 million; proceeds will be used to finance operations

Fiscal year highlights:

• Revenues of $3,283.8 million, up 7.7% from $3,048.4 million for fiscal 2023
• Adjusted EBITDA1 of $193.6 million, compared to $263.3 million last year
• Net loss of $114.0 million ($2.94 per share), compared to $25.3 million ($0.66 per share) in 2023
• Negative free cash flow1 of $122.1 million, compared to positive cash flow of $162.4 million during fiscal 2023

For more, go to https://www.transat.com/en-CA/corporate/investors .