Air Canada today reported its first quarter 2024 financial results.

“Air Canada’s solid first quarter results position our airline for a strong performance in 2024. We had operating revenues of $5.2 billion in the quarter, up $339 million from last year. Adjusted EBITDA grew by $42 million year over year to $453 million. I thank our employees for their hard work taking care of our 11 million customers and transporting them safely throughout the quarter. I also commend them for improving our operations, notably a 13 percentage-point increase in system-wide, on-time arrivals, preparing us for an anticipated busy summer period,” said Michael Rousseau, President and Chief Executive Officer of Air Canada.

“We are confident in our ability to deliver on our full year 2024 guidance. As we look toward the summer, we see a continued healthy demand environment, and our customers will have a wide range of exciting travel options across Europe, Asia, and North America, for their summer holiday planning.

“In the quarter, we generated over $1 billion of free cash flow, mainly resulting from cash generated from operating activities. Our net debt-to-adjusted EBITDA ratio fell to 0.9 at the quarter’s end. We also made further progress in our strategy to deleverage the balance sheet by reducing gross debt. Our accomplishments in this regard have been recognized by the credit rating agency community, more recently with S&P Global Ratings’ latest upgrade to ‘BB’ from ‘BB-‘ at the end of April. For the full year 2024, we remain certain of our ability to generate significant free cash flow. Our strong balance sheet will serve as the foundation on which we will grow our airline through investments in our world-class global network and the deployment of capital allocation strategies that will create sustainable, long-term value, for all of Air Canada and its shareholders,” said Mr. Rousseau.

*Adjusted CASM, adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization), adjusted EBITDA margin, leverage ratio, net debt, adjusted pre-tax income (loss), adjusted net income (loss), adjusted earnings (loss) per share, and free cash flow are referred to in this news release. Such measures are non-GAAP financial measures, non-GAAP ratios, or supplementary financial measures, are not recognized measures for financial statement presentation under GAAP, do not have standardized meanings, may not be comparable to similar measures presented by other entities and should not be considered a substitute for or superior to GAAP results. Refer to the “Non-GAAP Financial Measures” section of this news release for descriptions of these measures, and for a reconciliation of Air Canada non-GAAP measures used in this news release to the most comparable GAAP financial measure.
First Quarter 2024 Financial Results

Operating revenues of $5.226 billion increased $339 million or 7% on an operated capacity growth of 11% year over year.
Operating expenses of $5.215 billion increased $311 million or 6%. The increase was due to higher costs in nearly all line items reflecting higher operated capacity and traffic year over year, in addition to higher labour, maintenance and information technology expense. Lower fuel expense partially offset the increase.
Operating income of $11 million, with an operating margin of 0.2%, improved $28 million.
Adjusted EBITDA of $453 million, with an adjusted EBITDA margin* of 8.7%, improved $42 million.
Net loss of $81 million and diluted loss per share of $0.22 compared to net income of $4 million and diluted loss per share of $0.03.
Adjusted net loss of $96 million and adjusted loss per diluted share of $0.27 compared to adjusted net loss of $188 million and adjusted loss per diluted share of $0.53.
Adjusted CASM of 14.76 cents compared to 14.52 cents, an increase of 1.6% mainly driven by labour, maintenance and information technology expenses.
Net cash flows from operating activities of $1.592 billion increased $155 million, with continued strong growth in advance ticket sales consistent with seasonal trends.
Free cash flow* of $1.056 billion increased $69 million with continued strong growth in advance ticket sales consistent with seasonal trends.
Net debt-to-adjusted EBITDA ratio was 0.9 as at March 31, 2024, compared to 1.1 as at December 31, 2023. The improvement was driven by strong free cash flow in the first quarter of 2024.
Fleet update

Air Canada is in the process of arranging lease agreements for some additional Boeing 737 MAX 8 aircraft that would be scheduled for delivery in 2024 and enter service in 2025, upon completion of reconfiguration.

Outlook

For the second quarter of 2024, Air Canada plans to increase its ASM capacity by about 7% from the same quarter in 2023.

Air Canada also incurs expenses related to the operation of freighter aircraft, which some airlines, without comparable cargo businesses, may not incur. Air Canada had eight Boeing 767 dedicated freighter aircraft in its operating fleet as at March 31, 2024, compared to seven Boeing 767 dedicated freighter aircraft in service as at December 31, 2023. These costs do not generate ASMs and therefore excluding these costs from operating expense results provides for a more meaningful comparison of the passenger airline business across periods.

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Air Canada customers have a wide range of exciting options across Europe and Asiathis summer, along with a choice of 120 destinations in North America, to fulfill their summer travel plans. Alongside new and enhanced international routes to Singapore, Madrid, Stockholm, Osaka and Seoul, the carrier’s Summer 2024 international capacity is growing by 30 percent into Asia-Pacific and 25 percent to key leisure destinations in Southern Europe compared to last Summer.

Air Canada’s Atlantic schedule will provide the most non-stop service between Canada and Europe of any carrier. From Montreal and Toronto, Air Canada is launching new non-stop routes to Stockholm, and will increase frequencies to Rome and Athens. From Montreal, the carrier will also launch year-round service to Madrid, increase flights to Paris to up to three-times daily during the summer peak, and restore service to Lyon. From Toronto, service will increase to Copenhagen and will commence Edinburgh and Brussels earlier in the season.

Across the Pacific, Air Canada continues to build its Vancouver hub as the gateway to the Pacific.  The carrier recently started year-round service to Singapore from Vancouver, and will increase capacity to Hong Kong, Osaka and Seoul. On the East Coast, the airline is excited to start seasonal service from Toronto to Osaka and increase capacity to Tokyo, while from Montreal, Air Canada will begin seasonal service to Seoul, complementing enhanced capacity to Tokyo.

In North America, new routes will be offered from Toronto and Montreal to Tulum, from Toronto to Charleston, and from Montreal to St. Louis, Austin and New Orleans. Within Canada, Ottawa-Calgary and Halifax-Vancouver flights will resume, and there will be frequency or capacity increases, including between Toronto and Saskatoon, Regina, Victoria, Sydney and Gander, as well as between Montreal and Regina, Saskatoon, Victoria, Edmonton, Moncton, Frederictonand Deer Lake. 

International Summer 2024 service improvements:

Air Canada is increasing its international network capacity by 8 per cent for summer 2024 compared to summer 2023.

North American Summer 2024 service improvements:

• Air Canada is boosting service to North America, with an increase of 4 per cent in available daily seats in 2024, with 518 flights to 120 destinations.

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Air Canada has officially announced the resumption of its seasonal Vancouver to Bangkok service, North America’s only nonstop flight option to Bangkok, effective on October 27, 2024.

Photos: Air Canada.

Due to the increased popularity and success of this flight since its implementation in 2022, Air Canada has moved up the start date which previously commenced at the beginning of December. 

From October 27, 2024 through the end of November 2024, Air Canada will operate three weekly flights on this route, and starting in December 2024 and continuing through March 2025, Air Canada will further enhance connectivity with five weekly flights, catering to the growing demand for travel between Vancouver and Bangkok. The airline operates on the route using a Boeing 787-9 Dreamliner with 298 seats comprising 30 in Air Canada Signature, 21 in Premium Economy, and 247 in Economy Class.

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Air Canada’s much anticipated route launched from its Vancouver (YVR) Pacific hub last night and arrived this morning in Singapore, marking the inaugural of the airline’s newest international route and the only non-stop flight between Canada and Singapore. Stretching 12,818 kilometres (7,965 miles), the route is the airline’s longest flight measured by distance with a flying time of up to 16 hours and five minutes.

Schedule: 

Vancouver-Singapore

International Services

The Vancouver-Singapore route is operated with Boeing 787-9 Dreamliners.

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• Air Canada launches new awareness campaign across its in-flight entertainment, social media and more to raise awareness of illegal wildlife trade
• Preserving wildlife has been a component of Air Canada’s environmental and sustainability efforts to “Do More”
• Aeroplan to launch a points match week in support of the Jane Goodall Institute of Canada from April 22-28
• Air Canada is first airline globally to showcase conservation documentaries onboard from Age of Union 

Building on its partnership with the Jane Goodall Institute of Canada (JGIC), Air Canada is launching a new initiative to spotlight illegal wildlife trade (IWT) and its impact on global biodiversity. In collaboration with JGIC and involvement from Dr. Jane Goodall herself, the awareness campaign will showcase animals endangered from IWT on the airline’s in-flight entertainment welcome screens, social media and more during Earth Month, along with a special message from Dr. Jane Goodall.

Air Canada participates in the IWT fight with a zero-tolerance policy on carrying banned species, and hunting trophies or products associated with illegal wildlife activities. Air Canada became a signatory to the Buckingham Palace Declaration in 2020, and was the first airline in the Americas to hold the IATA IWT certification, which confirms policies and procedures are in place to reduce the likelihood of the transportation of illegal wildlife products. The airline became a member of the United for Wildlife’s North America Regional Chapter which launched in 2022, and has created IWT e-learning modules for all frontline employees and managers in Air Canada Cargo, its freight business.

To further support The Jane Goodall Institute of Canada’s ongoing environment and conservation work, Aeroplan will be launching a Points Match Week beginning Earth Day, April 22-28. All points donated by Aeroplan members will be matched at 100% by Aeroplan, with all proceeds going directly to the JGIC.

Air Canada also becomes the first airline globally to showcase conservation documentaries from Age of Union, a non-profit environmental alliance that supports and makes visible a global community of changemakers working on the ground to protect the planet’s threatened species and ecosystems.  Dax Dasilva, founder of Age of Union is part of The Jane Goodall Legacy Foundation’s Council for Hope, a group of highly respected and influential individuals from the fields of conservation, science, business, government, media and the arts with a shared mission for protecting our planet and perpetuating Jane’s legacy as an everlasting force for good. Customers can find these documentaries onboard in a newly launched environment-focused film and TV category, “Our Planet” in the airline’s inflight entertainment. Beginning in April customers will be able to watch The Corridor, We Are The St. Lawrence River, CAUGHT, and more.

Learn more about Air Canada’s efforts to combat illegal wildlife trade as well as its environmental and sustainability programs at its Leave Less website.

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Air Canada today issued its 2023 Annual Report highlighting the carrier’s achievements for the year. In addition to its strong financial results, including record annual revenue, the airline made progress on key strategic initiatives. 

“Air Canada delivered very strong results in 2023. We met key financial objectives and advanced or exceeded most of our strategic and operational goals for the year, demonstrating our ability to perform consistently,” said Michael Rousseau, President and Chief Executive Officer of Air Canada.

“We continued to renew our fleet with more fuel-efficient and comfortable aircraft, and we expanded our network and products to offer more choice and convenience to our customers. We also advanced our Environmental, Social and Governance programs through our sustainability, equity and accessibility activities and supported the communities we serve, including by providing thousands of employment opportunities.

“Air Canada has a solid foundation to build upon and a clear vision for the future as a leader in the global aviation industry, connecting Canada to the world, and as a trusted partner for all our stakeholders. I thank our customers for their loyalty, our 39,000 employees for their hard work and dedication to safe operations and our investors for their support throughout the year.”

Among its key accomplishments, in 2023 Air Canada:

• Safely carried 46 million passengers and earned full year operating income of $2.3 billion on record operating revenue of $21.8 billion. Adjusted EBITDA* more than doubled, reaching nearly $4 billion, and the airline generated cash from operating activities of approximately $4.3 billion and free cash flow* of nearly $2.8 billion.
• Reduced its leverage ratio* to 1.1 times adjusted EBITDA from 5.1 times adjusted EBITDA at December 31, 2022, and ended the year with total liquidity of $10.3 billion.
• Launched 14 new routes to serve 188 direct destinations. In support of its ongoing fleet renewal and network expansion it sourced 18 Boeing 787-10 Dreamliner and five Boeing 737 MAX-8 fuel-efficient aircraft for future delivery.
• Hired 8,000 people during the year, bringing the total employee count to approximately 39,000 and, through $1.6 billion in capital expenditures during the year, including within Canada, invested in such things as new aircraft, technology and customer service improvements.
• Furthered its business diversification, with Aeroplan reaching eight million members, Air Canada Cargo deploying its seven cargo freighters to more than 12 destinations, and Air Canada Vacations materially increasing its revenues.
• Completed 41 initiatives under its Elevating the Customer Experience service plan and improved key operating metrics, such as on-time performance and baggage handling. In addition, it accelerated its three-year accessibility plan to better accommodate customers with disabilities.
• Worked toward our climate action plan through various initiatives, including with the addition of modern and efficient aircraft and ground support equipment (e-GSE vehicles) to the fleet, sourcing additional SAF and continuing to engage with our corporate customers through our Leave Less Travel Program.
• Implemented four structural Diversity, Equity and Inclusion (DEI) pillars: DEI Executive Council, DEI Steering Committee, DEI Champions Program, and the formalization of employee resource groups (ERGs).
• Supported, with the Air Canada Foundation, 360 Canadian charitable organizations dedicated to the health and well-being of children. The Foundation raised more than $1.7 million, and the Dreams Take Flight program resumed flying, allowing more than 1,000 children to create treasured experiences.

* ^{Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization), leverage ratio (also referred to as net debt to trailing 12-month adjusted EBITDA ratio) and free cash flow are referred to in this news release. Such measures are non-GAAP financial measures, non-GAAP ratios, or supplementary financial measures, are not recognized measures for financial statement presentation under GAAP, do not have standardized meanings, may not be comparable to similar measures presented by other entities and should not be considered a substitute for or superior to GAAP results. Refer to the “Non-GAAP Financial Measures” section of the news release dated February 16, 2024 or Air Canada’s public disclosure file for descriptions of these measures, and for a reconciliation of Air Canada non-GAAP measures used in this news release to the most comparable GAAP financial measure.} 

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Air Canada said today it will cap fares and add more than 6,000 seats in select markets operated by Lynx Air in response to the airline’s announcement that it is suspending operations beginning February 26, 2024. The measures are to provide Lynx Air customers affected by the carrier’s shutdown affordable options in the Economy cabin on Air Canada flights for travel within Canada, to the US and to Cancun in Mexico so they can return home or make alternative travel arrangements for planned winter trips.

These fares will be available for purchase before February 26 for travel through April 2, to cover the March Spring break periods across Canada and the Easter holiday period.

Air Canada is also planning to add incremental capacity of more than 6,000 seats on Lynx routes from Toronto and Montreal to Cancun, Fort Myers, Orlando, Tampa. Phoenix and Las Vegas between February 25 and March 19. However, with the busy winter travel holiday period underway, flights are already relatively full and the carrier’s ability to increase capacity further is limited.

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Air Canada today announced that it has partnered with The Landline Company to connect airports in Hamilton and Waterloo Region with the airline’s Toronto Pearson global hub. Customers will be able to book a single itinerary combining a luxury motorcoach service with Air Canada flights for a seamless, convenient and more sustainable journey. Now available for booking, the multimodal service will begin operating as a pilot project from John C. Munro Hamilton International Airport and the Region of Waterloo International Airport in May 2024, with the potential to make it available elsewhere in Canada in the future.

How it works 

Landline will operate six, non-stop round trips daily to Toronto Pearson from each of the Hamilton and Region of Waterloo airports in southern Ontario. Air Canada customers beginning their journey at Hamilton or Region of Waterloo airports will check in as normal for their flight and obtain boarding passes for all segments of their trip. At a designated departure point at the local airport, they will board a luxury, Air Canada-branded motorcoach and their checked baggage will be loaded. Upon arrival at Toronto Pearson, customers will proceed directly through security screening, while checked bags will be automatically transferred to the onward connecting flight.

In the event of coach or flight delays, customers travelling on Landline will be automatically offered the same protections as customers travelling on air-only itineraries.  Members of Air Canada’s Aeroplan program will earn points for both ground and air segments, as on any normal connecting flight itinerary.

Premium motorcoaches 

The motorcoaches used by Landline for Air Canada are made in Canada by Prevost, a manufacturer of touring coaches based in Sainte-Claire, Quebec. Each Landline motorcoach provides a premium experience, with 36 spacious, leather seats in a two-by-one configuration. The coaches are equipped with free WiFi, power and a table tray available at each seat, generous overhead storage for carry-on baggage, and an onboard lavatory. Announcements will be made in both Official Languages and the coaches are fully accessible, including a power lift for customers requiring mobility aids.

Air Canada Regional Services

Air Canada operates to 40 communities across Canada, including in partnership with regional carriers Jazz Aviation LP and PAL Airlines. Through its innovative new partnership with Landline, Air Canada is extending its regional network to conveniently connect local airports directly to its global network. There is potential to further expand the partnership with Landline to connect with other regional airports in Canada at a future date.

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