Transat AT reduces Q2 loss more than expected
June 13, 2013, Montreal - Transat A.T. Inc. continued to lose money in its second quarter but the Montreal-based travel company says the summer is looking good and it expects to return to profitability this year.
Transat had a net loss of $22.8 million or 59 cents per share in the quarter ended April 30 and $1.1 billion of revenue from its Air Transat chartered airline and its integrated vacation businesses.
On an adjusted after-tax basis, Transat lost $1.43 million or four cents per share – far better than the 26 cents per share loss estimated by analysts and an improvement from a loss of 64 cents per share in the second quarter of 2012.
The adjusted earnings remove the impact of Transat's fuel-hedging program, restructuring and last year's revaluation of some of its investments.
Transat's revenue was in line with analyst estimates of $1.17 billion.
In the comparable period last year, Transat had $1.2 billion of revenue. Its net loss in the second quarter of 2012 was $13.2 million or 35 cents per share.
The company has been working for more than a year to eliminate its losses, sparked in the summer of 2011 by a spike in fuel costs.
Since then, the price for crude oil and aviation fuel has dropped dramatically amid a more uncertain global economy and the company has taken a number of measures to reduce its expenses.
"We reached our cost-reduction targets, and despite a challenging winter selling prices were higher than last year, hence the improvement in our results,'' said Transat president and CEO Jean-Marc Eustache.
"The summer is looking fairly good and we expect to be back to profitability this year.''