Air Canada (TSX: AC.B) has not always been the recipient of positive news in recent years, but what happened this week has spirits at the once-mighty carrier soaring.
The Maple Leaf airline reported $115 million of adjusted net income in the second quarter, a big improvement from a year earlier and far better than analysts were expecting.
What’s more, the Montreal-based airline said its operating revenue for the three months ended June 30 totaled $3.06 billion, a second-quarter record for Air Canada, up from $2.99 billion a year earlier and slightly better than analyst estimates.
Analysts noted that the adjusted profit amounted to 41 cents per share, an improvement from a year-earlier adjusted net loss of $7 million, or two cents per share
Thomson Reuters said those same analysts had estimated Air Canada would have 10 cents per share of adjusted net income and $3.02 billion of revenue.
Air Canada continued to show a net loss, before adjustments, although much smaller than last year's $161 million.
Its net loss for the most recent quarter was $23 million or nine cents per diluted share, compared with a loss of 59 cents in the same quarter last year.
The airline, which is already closely aligned with the Jazz regional service operated by Chorus Aviation Inc. recently launched a new discount long-range service called Rouge.
This summer, Rouge will fly to Edinburgh, Venice and Athens, as well as a number of Caribbean destinations. For snowbirds, the airline will add sun destinations in the Caribbean, Mexico and the U.S.
So, while the news is not necessarily all good, it’s positive enough for those behind the counters, at the controls, and in investment circles.
Air Canada shares closed Friday at $2.82, after crowding the three-dollar in the middle of a short week. Those shares reached their 52-week high at $3.40 early in April, while their gully of $1.02 was plumbed on August 9 of last year.
