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Air Canada posts $640M Q3 loss; operating revenue nearly triples compared to 2020

  • Air
  •   11-02-2021  7:51 am
  •   Pax Global Media
Air Canada posts $640M Q3 loss; operating revenue nearly triples compared to 2020
(Air Canada)
Pax Global Media

Air Canada posted its latest financial results on Tuesday (Nov. 2), reporting a net loss of $640 million, or $1.79 per diluted share, in the third quarter of 2021 compared to a net loss of $685 million or $2.31 per diluted share in the third quarter of 2020.

The airline said its operating revenue totalled $2.10 billion, representing almost three times the operating revenues of $757 million during the same period last year.

In the third quarter of 2021, Air Canada increased its ASM capacity by 87 per cent compared to the third quarter of 2020 (a reduction of about 66 per cent when compared to the third quarter of 2019).

"We are encouraged by the favourable revenue and traffic trends in the third quarter, with strong increases in key passenger geographic segments, a record cargo performance and significant improvements in both Air Canada Vacations and Aeroplan,” said Michael Rousseau, president and CEO of Air Canada, in a statement on Tuesday.

“The combination of these factors, along with effective cost controls, resulted in net cash flow of $153 million for the quarter, materially better than expected and as compared to the third quarter of 2020.”

Another “major accomplishment,” Rousseau said, was the series of financing transactions Air Canada completed in August.

This allowed the airline to lower its cost of borrowing, extend the maturities of its corporate debt, and raise gross proceeds of about $7.1 billion, Rousseau said.

As a result, at the end of the third quarter of 2021, Air Canada had roughly $9.5 billion in available liquidity on its balance sheet.

“This strong liquidity position and the confidence it conveys is a core element of our long-term prospects as we rebuild our airline,” Rousseau said. “We also have about $4.9 billion available under undrawn facilities.”

Restoring the network

Since the start of the year, Air Canada says it has recalled more than 10,000 employees.

It has also expanded services to the U.S., launched new routes, such as to Cairo, and expanded services to India and South America.

Next summer will see the return of popular seasonal destinations, such as Barcelona, Venice, Nice and Reykjavik.

“To support our network restoration, we have reversed our decision to cancel two Airbus A220 aircraft orders and are now accelerating deliveries of new Boeing 737 MAX aircraft,” the airline noted.

Amenities, such as onboard meal service and Maple Leaf Lounges, have also returned.

Air Canada said it plans to increase its fourth quarter 2021 ASM capacity by about 135 per cent from the same quarter in 2020.

When compared to the same period in 2019, fourth quarter ASM capacity is expected to decrease by about 47 per cent.

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