Canadians' diminishing appetite for post-pandemic travel yielded thinner profit margins on fares, while a 21 per cent year-over-year rise in labour costs drove up overall expenses, the company said.
"As expected, pent-up demand and 'revenge travel' factors are slowing over time," said
“Winter is challenging every year,” added CEO
Nonetheless, the company boosted passenger revenues by nearly 11 per cent year over year in the quarter ended
It also reaffirmed plans to bolster capacity by between six per cent and eight per cent and increase adjusted earnings to between
However, the airline still expects to remain below its soaring 2019 capacity levels until 2025, five years after the COVID-19 pandemic first hammered the travel industry.
This year, the carrier hopes a long-awaited return in business travel will jump-start its earnings, despite a slow start.
"In Q1 it was relatively stable. We didn't see a big growth, as some of our American peers did," Galardo said.
"But as we look late into the quarter and into Q1, we're starting to see some very encouraging signals on corporate demand — to the tune of almost 10 to 20 per cent greater on a year-over-year basis."
Executives in the tech and transportation sectors in particular have returned to the skies in greater numbers, he said.
"It's a little bit early to spike the ball on that, but we're seeing some very, very strong signals."
On Thursday,
Operating revenue rose seven per cent year over year to
On an adjusted basis, the
While an improvement, the result fell short of analysts' expectations of an adjusted loss of
This report by The Canadian Press was first published
Companies in this story: (TSX:AC)
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