Soaring fuel costs push Air Canada to lower earnings forecast
MONTREAL — Air Canada says it expects lower earnings this year due to sky-high fuel costs after a tough quarter that saw its bottom line nearly cut in half.
Air Canada, Canada's largest airline, has adjusted its earnings forecast downwards due to soaring fuel costs. The company now expects adjusted earnings of between $2.4 billion and $2.7 billion for the year, a significant drop from its previous forecast of $2.9 billion to $3.2 billion. The carrier reported a net income attributable to shareholders of $139 million for the three months ending September 30, a sharp decline of 47% compared to the same period a year ago.
Despite this, third-quarter operating revenues grew 21% to a record $6.98 billion as the company sought to offset the increased expenses. These expenses include a $906 million year-over-year increase in fuel costs. On an adjusted basis, Air Canada's earnings remained flat at 75 cents per share, which is higher than analysts' predictions of 50 cents per share, according to LSEG Data & Analytics.
The company's chief financial officer, John Di Bert, attributes the surge in revenues to strong demand and more cash generated per passenger.
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