“Excellent Summer” Drives Improved Transat Performance

Open Jaw

Revenues were down slightly for the 4th quarter, but Transat A.T. recorded adjusted operating income of $86.7 million, compared with $76.0 million in the same period last year. Net income was even better at $69.1 million, compared with $30.6 million in 2014.

 

"Our offering is increasingly distinctive and attractive to travellers. Hence, the very good results we recorded on the transatlantic market, which represents the lion's share of our business in summer," said President & CEO Jean-Marc Eustache. "We also posted a profit on sun destinations in the summer. These are among the best 2nd half results we have ever recorded, and this at a time when global capacity was up 7% on the transatlantic market. We did better only once, in 2013. All in all, this was an excellent summer,” Eustache said.

 

For fiscal 2015, the Corporation posted revenues of $3.6 billion, compared with $3.8 billion in 2014, and an adjusted operating income of $100.8 million, compared with $99.9 million in 2014.

 

Transat says the decrease in revenues is mainly attributable to the winter season. Compared with 2014, weaker results in the winter were offset by better summer results.

 

For the winter season, Transat posted revenues of $1.8 billion, vs. $2.0 billion in 2014, and an adjusted operating loss of $32.4

million, compared with $23.9 million in 2014. Capacity on sun destinations was down 6.3%, which largely contributed to a 7.4% decrease in the global number of travellers.

 

For the summer, Transat posted revenues of $1.8 billion, as in 2014, and an adjusted operating income of $133.2 million, compared with $123.8 million in 2014.

 

On the transatlantic market, Transat says it successfully managed a decrease in selling prices, in light of sharply declining fuel costs and intense competition, thanks to an offering well aligned with traveller's expectations, which contributed to improved results compared to 2014.

 

As at October 31, 2015, the Corporation's free cash totalled $336.4 million, compared with $308.9 million at the same date in 2014. Deposits from customers for future travel amounted to $489.6 million, compared with $424.5 million as at October 31, 2014.

 

Globally, Transat says its bookings for the 1st half are ahead by 15% over 2014 at the same date.

 

On the Sun destinations market outbound from Canada, Transat's capacity is approximately 7% higher than that offered last year and 45% of that capacity has been sold. Bookings are ahead by 12% and load factors up 2.1%.

 

The impact of the weaker CAD, net from lower fuel costs, will be a 4.0% increase in operating costs if the dollar and fuel costs remain at their current level. The company says margins are similar to last year at the same date.

 

On the transatlantic market, where it is low season, Transat's capacity is up 19% compared to that offered last winter. To date, 46% of that capacity has been sold, and bookings are ahead by 15%. Load factors are down 1.2% and selling prices are 6.0% lower.

 

As described in its plan announced in the 1st quarter of 2015, Transat continues to implement initiatives to reduce operating costs and improve unit margins, with an objective of at least $100 million over 3 years. In 2015, thanks mainly to the internalization of narrow-body aircraft and the implementation of a flexible fleet, Transat says it reached its objective of $45 million. The targets for 2016 and 2017 are at least $30 million and $25 million.





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