In a report released on Monday, Air Canada announced that they have lost $1.05 billion in their first quarter, compared to a profit of $345 million in the same quarter last year.
This loss is largely due to governments imposing travel restrictions around the world amid the ongoing the COVID-19 pandemic, and the impacts that has had on air travel.
Canada’s largest airline says the loss amounted to $4.00 per diluted share for the quarter, compared with a profit of $1.26 per diluted share in the first quarter of 2019.
Operating revenue also fell to $3.72 billion, compared to $4.43 billion in last year’s quarter.
“We have developed a plan to manage through a protracted downturn, recognizing that the pandemic and its fallout will materially impact both customer demand and our liquidity in the short and medium term,” Calin Rovinescu, President and Chief Executive Officer of Air Canada said in the report.
“Moreover, while the duration of the pandemic and its fallout remain unknown, it is our current expectation that it will take at least three years to recover to 2019 levels of revenue and capacity.”
The airline has reduced its second quarter capacity by 85 to 90 per cent in comparison with the same quarter last year, while its third quarter capacity is expected to be reduced by about 75 per cent compared to the year before.
Air Canada is also accelerating the retirement of 79 older aircraft in a move that they say will simplify the airline’s fleet, reduce costs structure, and lower its carbon footprint.
They have also adopted the Canada Emergency Wage Subsidy (CEWS) for most of their workforce, which allowed them to return previously furloughed Canadian-based employees to their payroll for the March 15th to June 6th period.
In his daily address on Monday, Prime Minister Justin Trudeau alluded that help for Canada’s airlines may be on the way, but the immediate priority has been helping families and workers with CERB and wage subsidies.
