Air Canada reports profit in the first quarter
Air Canada has confounded expectations to report a first quarter profit, despite challenges stemming from the grounding of the Boeing 737 Max.
With its 737 Max fleet grounded and an attendant reduction of between 3-4% in its seat capacity, operating revenue came in at CA$4.453bn (US$3.3bn), an increase of CA$383mn (US$284.2mn) compared to the CA$4.07bn (US$3.02bn) recorded in last year’s first quarter.
The company reported an adjusted net income of CA$17mn (US$12.6mn) in the first quarter.
Air Canada was keen to emphasize the resilience of the company in the face of difficulty as the key to its success, with Chief Executive Officer, Calin Rovinescu, saying: “The agility of our business model, the flexibility of our fleet and our team's ‘can-do’ culture was on full display as we adjusted to these unexpected circumstances.”
“This is further evidence of the changed culture at Air Canada, with its emphasis on nimble decision-making and a focus on customer care.”
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The airline was confident in its ability to continue in profitability, as Rovinescu stated in the company’s press release: “These Q1 results, following on records set in previous quarters, are an affirmation of our ability to operate on a sustainably profitable basis, notwithstanding fuel price or foreign currency fluctuations or other unexpected challenges.”
Air Canada consequently expects strong demand in the summer, with second quarter results in line with predictions made prior to the grounding. It also expects to be able to bounce back swiftly once its 737 Max fleet is ungrounded, due to its status as the only North American airline with 737 Max simulation facilities.
The good results spurred a share price jump of more than 4%. Air Canada is listed on the Toronto Stock Exchange under the symbol “AC”.