WestJet earns $44.7 million in second quarter
By The Canadian Press
July 30, 2013, Calgary - WestJet says it earned net income of $44.7 million in the second quarter, or 34 cents per diluted share, compared to $42.5 million, or 31 cents per diluted share in the same period a year ago.
By The Canadian Press
The Calgary-based airline says the results marks the 33rd consecutive quarter of profitability and include $8.4 million of one-time pre-tax transition costs associated with WestJet's business plan.
WestJet launched a new regional service called Encore at the end of June.
The company's quarterly revenue came in at $843.69 million, an increase from $809.28 million in the year-before period but below an analyst estimate of $860.7 million.
The profit was better than expected, however. Analysts polled by Thomson Reuters were on average expecting WestJet to bring in 33 cents per share.
"We are pleased with another quarter of record earnings,'' said WestJet president and CEO Gregg Saretsky.
"We continue to make good progress with our company-wide business transformation initiative and I want to thank WestJetters for their tremendous dedication to the continued success of our airline.''
Earlier this month, the Calgary-based airline reported an eight per cent increase in passenger traffic for June, despite some cancellations and weakness following severe floods in southern
But the company said its load factor decreased for the fifth consecutive month, despite the higher traffic in June, falling 2.2 percentage points to 76.8 per cent as capacity increased 11.3 per cent, outpacing traffic gains.
It flew nearly nine million passengers in the first half of the year, a 5.7 per cent increase from the prior year and achieved a load factor of 81.9 per cent.
In early June, WestJet received two new Q400 turboprop planes from Bombardier, the first of 20 firm orders and 25 additional options.
The airline plans on using the two 78-seat Bombardier planes for Encore.
Encore will initially add Fort St. John, B.C. to WestJet's network and also fly on routes between Vancouver and Victoria, as well as Calgary to Nanaimo, B.C. Additional routes will be added as it takes delivery of five more planes by the end of the year.
In an effort to compete more effectively with Air Canada, the country's biggest airline, WestJet has been looking to draw more international traffic into its network.
In the United States, WestJet is working with American Airlines and Delta. On the international front, WestJet has announced partnerships with British Airways, Cathay Pacific, China Airlines, Air France and KLM.
WestJet is also looking to beef up its presence in the ultra-competitive Toronto-Ottawa-Montreal circuit by offering more frequent flights and various perks to business travellers.
WestJet said it expects to continue its strong traffic and revenue growth in the third quarter of 2013 and expects jet fuel costs to range between 90 and 92 cents per litre in the third
quarter, representing a two per cent year-over-year increase.
On Monday, WestJet's board declared a cash dividend of 10 cents per common voting share and variable voting share to be paid on Sept. 30, 2013.