Air Canada has released its preliminary financial results for the second quarter of 2024 and has updated its financial and capacity guidance for the full year 2024.
Q2 2024 Preliminary Financial Performance
Air Canada has released its preliminary financial results for the second quarter of 2024, along with updated financial and capacity guidance for the year. The airline reported operating revenues of approximately $5.5 billion, reflecting a 6.5% increase in operated capacity compared to the same period in 2023, which had revenues around $5.4 billion. Operating income for Q2 2024 is estimated at $466 million, yielding an operating margin of 8.4%, compared to $802 million in Q2 2023. Adjusted EBITDA is projected at $914 million, down from about $1.2 billion in the previous year’s second quarter.
These preliminary figures are subject to change as Air Canada finalizes its interim unaudited condensed consolidated financial statements for Q2 2024. The finalized results may differ from these estimates after the completion of closing procedures and finalization of the interim financial statements.
Updated 2024 Financial Outlook
Air Canada has revised its full-year 2024 financial and capacity guidance as follows:
| Metric | Previous 2024 Guidance | Updated 2024 Guidance |
|---|---|---|
| ASM Capacity | Increase of 6-8% vs. 2023 | Increase of 5.5-6.5% vs. 2023 |
| Adjusted CASM | Increase of 2.5-4.5% vs. 2023 | Increase of 2.5-3.5% vs. 2023 |
| Adjusted EBITDA | $3.7-4.2 billion | $3.1-3.4 billion |
The updated guidance reflects a lower yield environment, lower-than-expected load factors for the latter half of the year, and competitive pressures in international markets. These revisions also consider factors such as jet fuel prices and the exchange rate of the Canadian dollar against the U.S. dollar.
The adjustments in capacity guidance account for ongoing supply chain issues, market conditions, and geopolitical factors. The revised Adjusted CASM reflects these capacity adjustments. Air Canada is managing costs through productivity improvements, cost reductions, and other initiatives.
Despite these challenges, Air Canada continues to experience strong demand. Q2 2024 operating revenues are expected to set a record for the second quarter, with load factors remaining above historical averages.
Upcoming Detailed Results
Air Canada will release its detailed Q2 2024 results on Wednesday, August 7, 2024. Following the release, key executives, including President and CEO Michael Rousseau, Executive Vice President and CFO John Di Bert, and Executive Vice President, Revenue and Network Planning Mark Galardo, will present the results and address analysts’ questions. A subsequent session will allow term loan B lenders and bondholders to ask questions to Mr. Di Bert and Vice President and Treasurer Pierre Houle.
Event Details:
- Date: Wednesday, August 7, 2024
- Time: 08:00 a.m. ET
- Webcast: Air Canada Webcast
- Telephone: 647-932-3411 or 1-800-715-9871 (toll-free), Conference ID 6478306
- Replay: An online replay will be available shortly after the call at Air Canada Investors
Non-GAAP Financial Measures
Air Canada utilizes certain non-GAAP financial measures to provide additional insights into its financial and operational performance. These measures, which include Adjusted CASM, Adjusted EBITDA, and Adjusted EBITDA margin, exclude certain expenses such as aircraft fuel, ground packages at Air Canada Vacations, and freighter costs to offer a clearer comparison across periods.
Caution Regarding Forward-Looking Information
This release contains forward-looking statements based on assumptions and subject to risks and uncertainties. Factors that could cause actual results to differ materially include economic and geopolitical conditions, competitive pressures, and other risks detailed in Air Canada’s public disclosure. These statements are current as of the date of this release and may change. Air Canada disclaims any obligation to update these statements, except as required by law.
Tags: financial performance, financial results, market conditions, preliminary results, Air Canada
