Air Canada forecasts better-than-expected CASM improvements in 2013, 3Q EBITDAR to increase
Air Canada stated (03-Oct-2013) it expects that the Canadian dollar will trade, on average, at CAD1.03 per US dollar for the full year 2013 and that the price of jet fuel will average 88 cents per litre for the FY2013. The carrier expects Canadian GDP growth of 1.25% to 1.75%. As a result of the impact of cost reduction initiatives across various expense line categories, including sales and distribution costs, food, beverage and supplies and other operating expenses, Air Canada now expects 3Q2013 adjusted CASM to decrease between 3.0% and 3.5% year-on-year (as opposed to the adjusted CASM decrease of 1.5% to 2.5% projected in a 07-Aug-2013 release). Taking into account the projected improvement in adjusted CASM for 3Q2013, Air Canada now expects its full year 2013 adjusted CASM to decrease in the range of 1.5% to 2.0% year-on-year (as opposed to the 1.0 to 2.0% decrease projected on 07-Aug-2013). Air Canada continues to expect its full year 2013 system and domestic ASM capacity to each increase in the range of 1.5% to 2.5% when compared to FY2012. For the full year 2013, Air Canada also continues to expect:
- Depreciation, amortisation and impairment expense to decrease by CAD115 million from the full year 2012;
- Employee benefits expense to increase by CAD70 million from the full year 2012;
- Aircraft maintenance expense to decrease by CAD40 million from the full year 2012 level.
President and CEO Calin Rovinescu added: "Based on our third quarter load factor, and coupled with the ongoing positive results of our cost transformation and revenue enhancement initiatives, we expect EBITDAR (excluding the impact of benefit plan amendments in 2012) and adjusted net income for the third quarter to be above last year's level for the same period". [more - original PR]