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Investment pushes ACE Aviation loss to $656 million

Feb. 11, 2010, Montreal - ACE Aviation Holdings lost $656 million the fourth quarter, mostly related to its minority investment in Air Canada.


February 11, 2010
By The Canadian Press

The Montreal-based holding company said Thursday the quarter included a $630-million non-cash loss on its investment in Canada's largest airline, which has been losing money.

ACE's operating loss in the quarter ended Dec. 31 was $5 million.

For the full year, ACE lost $692 million and had consolidated operating losses of $244 million.

The net loss included $300 million of interest expenses and the $630 million non-cash loss on Air Canada, offset by $531 million in foreign exchange gains.

ACE, which was created when Air Canada exited from bankruptcy protection in late 2004, has reduced its stake in the airline to 27 per cent in October, from 75 per cent.

ACE no longer consolidates the airline's financial position and results in its own.

As of Jan. 31, ACE's net assets were valued at $302 million, or $9.30 per share. They include $50 million cash, $150 million secured loan to Air Canada, 75 million voting shares in the airline worth $100 million and $5 million of interest receivables. It also had $3 million in liabilities.