Air Canada sees bump in operating costs
Ottawa, Apr 30 (IBNS): Increased capacity and passenger traffic has led to rise in Air Canada’s operating costs, media reports said.
Its operating expenses in the first quarter of 2018 increased $413 million or 11 per cent from the same quarter in 2017.
Air Canada reported much lower operating loss of $14 million, compared to $30 million in the first quarter of 2017.
According to the reports of Air Canada, operating revenue for the quarter totalled $4.07 billion, up from $3.64 billion.
This was in spite of the increase in capacity and higher fuel prices year-over-year.
Air Canada’s cost per available seat mile (CASM) increased reportedly 2.4 per cent from the first quarter of 2017 mainly due to lease extensions that were negotiated earlier than anticipated, which resulted in a decrease to maintenance provisions in the first quarter of 2018.
"We are pleased with our strong results in the first quarter, historically the most challenging of the year for airlines in Canada. Alongside the record quarterly and annual results we have previously reported, our performance in this more challenging quarter affirms Air Canada's progress towards consistent earnings and long-term, sustained profitability," said Calin Rovinescu, Air Canada's president and chief executive officer.
Air Canada reportedly continues to expect positive free cash flow in the range of $250 to $500 million in 2018 and is not planning any sale-leaseback transactions in 2018.
(Reporting by Asha Bajaj)
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