Air Canada Reports Third Quarter Net Loss of $640 Million on $2.1 Billion in Revenue
Air Canada has reported a third quarter 2021 negative EBITDA of $67 million, an operating loss of $364 million, and a net loss of $640 million or ($1.79) per diluted share. Revenues for the third quarter nearly tripled to $2.1 billion compared to $757 million during Q3 2020.
On Tuesday (November 2, 2021), Air Canada reported their third quarter 2021 financial results for the period ending September 30, 2021. The carrier reported a third quarter negative EBITDA, excluding special items, of $67 million, compared to negative $554 million during the same period last year. For Q3 2021, Air Canada reported an operating loss of $364 million, compared to an operating loss of $785 million during the third quarter of 2020, and a net loss of $640 million or ($1.79) per diluted share, versus a net loss of $685 million of ($2.31) per diluted share during Q3 2020. Third quarter revenue nearly tripled year-over-year to $2.1 billion from $757 million in the third quarter of last year.
In Tuesday’s announcement, Air Canada’s President and Chief Executive Officer, Michael Rousseau, said,
“We are encouraged by the favourable revenue and traffic trends in the third quarter, with strong increases in key passenger geographic segments, a record cargo performance and significant improvements in both Air Canada Vacations and Aeroplan. The combination of these factors, along with effective cost controls, resulted in net cash flow of $153 million for the quarter, materially better than expected and as compared to the third quarter of 2020.
“Another major accomplishment was the series of financing transactions completed in August, allowing us to lower our cost of borrowing, extend the maturities of our corporate debt, and raise gross proceeds of about $7.1 billion. As a result, at the end of the third quarter of 2021, Air Canada had about $9.5 billion in available liquidity on its balance sheet. This strong liquidity position and the confidence it conveys is a core element of our long-term prospects as we rebuild our airline. We also have about $4.9 billion available under undrawn facilities.
“Since the start of the year we have recalled more than 10,000 employees. We have expanded services to the U.S., and have launched new routes, such as to Cairo. We also announced expansions of our services to India and South America as well as the return next summer of popular seasonal destinations such as Barcelona, Venice, Nice and Reykjavik. To support our network restoration, we have reversed our decision to cancel two Airbus A220 aircraft orders and are now accelerating deliveries of new Boeing 737 MAX aircraft. For our customers, we are pleased to bring back amenities such as onboard meal service and Maple Leaf Lounges.
“I want to express my continuing gratitude to all our employees for their incredible efforts, resilience, and teamwork throughout the challenging past 20 months, most recently as we have worked hard to restart a very complex eco-system with our many partners. I am pleased these efforts were globally recognized when our employees recently won Best Airline Staff in Canada and Best Airline Staff in North America in the prestigious 2021 Skytrax World Airline Awards. Their unstoppable energy, purpose and steadfast optimism have lifted and inspired us all as we navigate towards brighter skies ahead.”
At September 30, 2021, Air Canada had unrestricted liquidity of approximately $14.4 billion, including roughly $9.5 billion in cash, cash equivalents and investments, as well as around $4.9 billion in undrawn credit facilities.
The airline has decided to proceed with the purchase of two Airbus A220-200s which were previously canceled as part of a larger order for 12 aircraft. Additionally, the airline has reached an agreement with Boeing to accelerate the delivery of four 737 MAX aircraft into the fourth quarter of this year, for a total of seven MAX deliveries in 2021. The remaining nine Boeing 737 MAX aircraft are expected to be delivered by the second quarter of 2022, expanding Air Canada’s MAX fleet to 40 aircraft.
Air Canada is Canada’s largest domestic and international airline. The Canadian flag carrier is a founding member of the Star Alliance and the only international network carrier in North America to receive a Four-Star ranking from Skytrax. For the last two years Air Canada was also named Global Traveler’s ‘Best Airline in North America.’ Additionally, Air Canada has committed to a net zero emissions goal from all global operations by 2050.
Source: Air Canada