Tag Archives: CL-600-2D15

Air Canada Express arrives in Austin, Texas

Air Canada Express logo-3

Air Canada Express (Jazz Aviation) (Halifax) yesterday (May 18) officially launched its first flight to Austin, Texas. With Air Canada Express flight AC 8840 from Toronto (Pearson), Austin officially became part of Air Canada’s international network of more than 190 destinations on five continents.

Jazz logo (Jazz)

Daily Air Canada Express flights from Toronto to Austin are operated by Jazz Aviation LP with 75-seat Bombardier CRJ705 aircraft with a choice of both premium and economy cabins of service.

New Air Canada and Air Canada Express routes launched to date this year in addition to Toronto-Austin include: Montreal-Venice, Vancouver-Osaka, Vancouver-Comox, Calgary-Halifax and Calgary-Nanaimo. Upcoming new routes still to launch include: Toronto-Dubai, Toronto-Delhi, Toronto-Amsterdam, Toronto-Atlantic City, Toronto-Abbotsford, Montreal-Mexico City and Calgary-Terrace.

Copyright Photo: TMK Photography/AirlinersGallery.com. Bombardier CRJ705 (CL-600-2D15) C-GOJZ (msn 15053) taxies at the Toronto (Pearson) hub.

Air Canada Express-Jazz aircraft slide show: AG Airline Slide Show

Air Canada Express-Jazz routes from Toronto (Pearson):

Air Canada Express-Jazz YYZ 5.2015 Route Map

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Jazz Aviation’s parent, Chorus Aviation, posts a higher 2Q net profit of $36.5 million

Chorus Aviation (Halifax), the parent of Jazz Aviation (Air Canada Express) (Halifax), reported a second quarter net profit of C$36.5 million ($33.5 million). This basically quadruples its second quarter 2013 net income of C$7.9 million (&.2 million) of the previous year.

Here is the full report:

For the second quarter 2014, Chorus reported EBITDA of $50.7 million compared to $48.0 million in the same quarter 2013, an increase of $2.7 million. Operating income was $34.3 million, $2.6 million higher than the same period 2013. Adjusted net income of $22.2 million or $0.18 per basic share was up by $0.8 million or $0.01 per basic share over the second quarter 2013. Chorus incurred $4.5 million in employee separation program costs in the second quarter versus $2.2 million in the same period in 2013. Chorus has invested $17.2 million in employee separation since the inception of this cost savings program in the first quarter of 2013.

For reporting purposes, at each quarter end, Chorus converts its US denominated aircraft debt into equivalent Canadian dollars based on the prevailing exchange rate. Chorus manages its exposure to currency risk on such long-term debt by billing related lease payments within the Capacity Purchase Agreement (‘CPA’) with Air Canada in the underlying currency (US dollars) related to the aircraft debt. In the second quarter of 2014, Chorus had an unrealized foreign exchange gain of $14.3 million versus an unrealized foreign exchange loss of $13.5 million in the same period of 2013.

Financial Performance –Second Quarter 2014 Compared to Second Quarter 2013

Operating revenue increased from $410.3 million to $417.8 million, representing an increase of $7.5 million or 1.8%. Controllable revenue increased by $9.0 million or 3.5%. This increase occurred primarily as a result of rate increases made pursuant to the CPA of $5.8 million, a favourable US dollar exchange rate of $5.2 million, and a $0.3 million increase in incentives earned under the CPA with Air Canada. These increases were offset by decreased CPA Billable Block Hours of $2.3 million.

Pass-through revenue decreased by $2.1 million or 1.4% from $148.7 million to $146.6 million, which included a decrease of $8.7 million related to airport and navigation fees and terminal handling services. (Effective January 1, 2014, Air Canada entered into a commercial agreement with the Greater Toronto Airport Authority (‘GTAA’) that encompasses Chorus’ Air Canada Express operations. GTAA costs related to landing, terminal and other airport user fees, which are treated as pass-through costs under the CPA, are now paid directly by Air Canada pursuant to this agreement.) This decrease was offset by an increase of $7.3 million related to fuel costs driven primarily by an increase in jet fuel prices. The sale of consignment inventory was the primary factor in other revenue increasing by $0.6 million.

Operating expenses increased from $378.6 million to $383.6 million, an increase of $5.0 million. Controllable costs increased from $229.9 million to $237.0 million, an increase of $7.0 million or 3.1%. Pass-through costs decreased from $148.7 million to $146.6 million, a decrease of $2.1 million or 1.4%.

Salaries, wages and benefits increased by $2.7 million from $100.7 million to $103.4 million. Adjusted salaries, wages and benefits (adjusted by removing employee separation program costs and capitalized major maintenance overhaul labour costs), which includes pension, incentive compensation and other employee benefits, decreased by $0.9 million after incurring an increase in stock based compensation of $0.8 million due to a change in accounting policy. Employee separation program costs incurred during the three months ended June 30, 2014 were $4.5 million, an increase of $2.3 million over the same period of 2013. These costs include employee separation program costs of $2.1 million in 2014 related to the commencement of outsourcing of passenger handling services under applicable collective agreements. Salaries and wages were also affected by fewer labour costs being capitalized as a result of reduced major maintenance overhauls on owned aircraft of $1.4 million.

Aircraft maintenance expense increased by $4.0 million from $37.9 million to $41.9 million partially as a result of an unfavourable US dollar exchange rate on certain maintenance material purchases of $2.7 million and increased other maintenance costs of $2.6 million. These increases were offset by decreased Block Hours of $1.3 million.

Other expenses decreased by $0.8 million from $32.0 million to $31.2 million. The decrease was the result of reduced general overhead expenses.

Non-operating income increased by $27.8 million from a non-operating expense of $19.2 million to a non-operating income of $8.6 million. The strengthening of the Canadian dollar during the quarter contributed to a foreign exchange gain of $11.8 million compared to a foreign exchange loss of $13.0 million in the same period last year. During the quarter, Chorus redeemed the remaining balance of the convertible debentures, which accounted for a decrease in interest accretion of $0.3 million and a decrease in interest expense of $1.5 million. Interest expense related to long-term debt decreased by $0.8 million due to planned principal repayments. Chorus met employment conditions required in order to obtain the maximum annual forgiveness of a portion of the forgivable loan from the province of Nova Scotia, and as such $0.5 million was recorded in other income.

EBITDA was $50.7 million compared to $48.0 million in 2013, an increase of $2.7 million or 5.7%, producing an EBITDA margin of 12.1%.

Operating income of $34.3 million was up $2.6 million or 8.1% over second quarter 2013 from $31.7 million.

Net income for the second quarter of 2014 was $36.5 million or $0.30 per basic share, an increase of $28.6 million from $7.9 million. On an adjusted basis, net income was $22.2 million or $0.18 per basic share, an increase of $0.8 million from $21.4 million. A reconciliation of these non-GAAP measures to their nearest GAAP measure is provided in Chorus’ Management’s Discussion and Analysis dated August 13, 2014.

Copyright Photo: TMK Photography/AirlinersGallery.com. Bombardier CRJ705 (CL-600-2D15) C-GLJZ (msn 15051) approaches the runway at Toronto’s Lester B. Pearson International Airport (YYZ).

Air Canada Express-Jazz Aviation: AG Slide Show