Despite $56.6M Q1 loss, Transat’s path to profitability improving, says CEO

Air
03-09-2023 7:53 am
Michael Pihach

Michael Pihach

Michael Pihach is an award-winning journalist with a keen interest in digital storytelling. In addition to PAX, Michael has also written for CBC Life, Ryerson University Magazine, IN Magazine, and DailyXtra.ca. Michael joins PAX after years of working at popular Canadian television shows, such as Steven and Chris, The Goods and The Marilyn Denis Show.

“Transat is on an upswing and is headed for a return to profitability,” said Annick Guérard, president and CEO of Transat A.T., sharing the company’s results for the first quarter ended Jan. 31, 2023, on Thursday (March 9).

"The momentum from the end of 2022 continues, confirming our financial scenarios," stated Ms. Guérard.

Transat’s Q1 net loss amounted to $56.6 million, or $1.49 per share (diluted), compared with $114.3 million, or $3.03 per share (diluted), for the same quarter last year.

But in the first quarter of 2023, Transat’s revenues more than tripled compared with the corresponding quarter in 2022, the Montreal-based company noted.

Across all programs, combining European and South destinations, Transat deployed capacity comparable to that of 2019. And while the load factors were slightly lower, the shortfall was largely offset by higher prices, the company said.

In addition, airline unit revenues, expressed in yield, increased by more than 20 per cent compared with the first quarter of 2019.

As a result, Transat recorded an adjusted operating income of $3.3 million for the period, an improvement of $39.7 million compared with the first quarter of 2022.

“These results are especially encouraging since the first quarter, which falls in the shoulder period, is usually the lowest of the year,” Guérard pointed out.

Resilient demand for travel is supporting prices and is helping the company deal with the pressure on operating costs, she said.

“The context is therefore challenging but remains favourable to recovery in travel and Transat's relaunch," added Ms. Guérard.

Weathering the storm

Transat noted that it “successfully coped” with the many flight disruptions and delays caused by bad weather and operational problems at airports across North America during the holiday travel season last December and January.

Transat said that during this time it record strong business volume while maintaining a “reputation for excellent customer service.”

“This corporate culture is demonstrated every day by Transat employees, to whom the corporation would like to express its appreciation,” the company noted.

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