While waiting to find a way to refinance its heavy debt, Transat is buying itself a little time by postponing a repayment deadline. This did not prevent the leisure travel specialist from widening its loss in the second quarter.
The parent company of Air Transat had already warned investors that pressure on package prices, union unrest as well as planes grounded due to engine problems would clip its wings. If its revenues from the blue star company increased by 12% during the months of February, March and April to reach 973 million, the picture is different in terms of profitability indicators.
The net loss was $54.4 million, or $1.40 per share, compared to a deficit of $29 million, or $76 million, in the second quarter last year. Adjusted operating profit contracted 32%.
In terms of profitability, the [bénéfice d’exploitation ajusté] fell to 38 million due to problems already reported at both the industry and societal levels.
Annick Guérard, President and CEO of Transat, in a press release
Excluding non-recurring items, the Montreal-based company posted an adjusted loss of 39 million, or $1.02 per share, in the second quarter ending April 30, compared to 8 million, or 21 cents per share. action, a year ago.
Analysts surveyed by financial data firm Refinitiv had expected an adjusted loss per share of 81 cents.
“In addition to some weakness in unit air revenues on its main transatlantic routes, which represent the majority of flights during the summer, Transat will continue to face headwinds in terms of costs and operational problems due to its planes grounded,” estimated analyst Cameron Doerksen of National Bank Financial in a note sent to his clients.
During the second quarter, Transat was able to postpone, until February 2026, the moment when it must repay a debt of 91 million. The company also repaid another loan of 36 million. As of April 30, the net debt of the air carrier and tour operator nevertheless amounted to 1.9 billion.