Group Aeroplan reported 2Q2009 profits of CAD26.7 million, down 15.2% year-on-year, as the company suffered a drop in gross billings of approximately 3%. The drop in revenue was mostly attributable reduced levels of sales of Aeroplan miles, which declined 5.6%.
The result was also affected by higher mile redemptions cost (up 4.7%), ties to the reflecting the general economic environment, as well as concern about Air Canada’s stability, shorter trip distances and unit cost increases related to airline capacity reductions and a marginal decrease in selling, general and administrative expenses. If current economic conditions prevail, Groupe Aeroplan forecasts a 2-4% decline in consolidated gross billings for the full year 2009.
Selected Aviation suppliers’ daily share price movements (% change): 18-Aug-09
Want more analysis like this? CAPA Membership gives you access to all news and analysis on the site, along with access to many areas of our comprehensive databases and toolsets.
Find out more and take a free trial.