Air Canada sees more profit coming from international demand, cheaper jet fuel
Air Canada raised its annual core profit forecast on Friday, as the country’s largest carrier benefits from strong demand for international travel and lower jet fuel prices.
Major North American carriers with international operations are cashing in on a booming demand for overseas travel and a resurgence in business bookings.
Air Canada is increasing its daily flights to China, while also adding capacity to other Asia Pacific routes.
The airline also announced the repurchase of up to 35.78 million shares, its first buyback authorization since the pandemic.
The repurchase aims to address the dilution that occurred due to its financing needs during the pandemic, it said.
Last month, Air Canada signed a new labor deal with its pilots, which would give the aviators a general four-year cumulative pay hike of about 42%, generating about C$1.9 billion in additional value.
“The demand environment remains favorable. We have adjusted our full-year guidance and underlying assumptions to account for the evolution of the fuel price environment and for certain contract-related adjustments,” CEO Michael Rousseau said.
The company lowered its expectation for average price of jet fuel to C$1 per liter for 2024, from the previous estimate of C$1.03.
The carrier now expects its 2024 adjusted earnings before interest, taxes, depreciation and amortization of about C$3.5 billion ($2.51 billion), compared with its previous forecast of C$3.1 billion to C$3.4 billion.
Montreal-based Air Canada posted an adjusted profit of C$2.57 per share in the third quarter, compared with analysts’ average estimate of C$1.58, according to data compiled by LSEG.
It reported a quarterly operating revenue of C$6.12 billion in the three months ended Sept. 30, down
Read more on globalnews.ca
