Air Canada on track to meet or exceed key financial targets

Air Canada confirmed (29-Jul-2016) it remains on track to meet or exceed the following key financial targets:

• Annual EBITDAR margin of 15% to 18% over the term of 2016-2018;
• Year-over-year ROIC of 13% to 16% over the term of 2016-2018;
• A leverage ratio not exceeding 2.2 by 2018.

Air Canada also remains committed and on track to reducing CASM by 21%, excluding the impact of foreign exchange and fuel prices, by the end of 2018 when compared to 2012. For FY2016:

• Depreciation, amortisation and impairment expense is expected to increase by CAD150 million (USD114 million) year-over-year. This increase is mainly due to new deliveries of Boeing 787 and 777 aircraft, and to the Boeing 777 fleet reconfiguration programme;
• Employee benefits expense expected to increase by CAD20 million (USD15 million) year-over-year, as opposed to CAD30 million (USD23 million) as previously projected in Apr-2016. The lower-than-expected increase is driven by the impact of a gain on post-employment liabilities, which reduced benefits expense by CAD10 million (USD8 million) in 2Q2016;
• Aircraft maintenance expense to increase by CAD165 million (USD126 million) year-over-year, as opposed to CAD190 million (USD145 million) as previously projected in Apr-2016. This improvement is largely driven by the lower-than-expected aircraft maintenance expense in 2Q2016. [more - original PR]