Air Canada has revealed that it has lost $1.05 billion in its first quarter as governments worldwide impose ongoing travel restrictions due the COVID-19 pandemic.
The loss is a dramatic contrast to the $345 million in profit Air Canada made in the same quarter last year.
In a report issued on Monday (May 4th), the carrier noted that its loss amounted to $4 per diluted share for the quarter compared with a profit of $1.26 per diluted share in the first quarter of 2019.
Air Canada said revenue fell by $712-million to $3.7-billion in the first three months of 2020 compared to last year.
"Our first quarter results reflect the severity and abruptness of the impact that the COVID-19 pandemic has had on Air Canada, which started to be felt across the global airline industry in late January with the suspension by many carriers, including Air Canada, of services to China,” Calin Rovinescu, president and CEO of Air Canada, stated in a release. “The impact was exacerbated during the month of March with mandated social distancing, unprecedented government-imposed travel restrictions in Canada and around the world and the shutting down of economies.”
Rovinescu added that Air Canada is "resolutely committed to bringing our airline successfully through this crisis,” calling the COVID-19 pandemic “the darkest period ever in the history of commercial aviation.”
“...at least three years” to recover
Recognizing that the duration of the pandemic is still unknown, Rovinescu said that it would be “at least three years” to recover to 2019’s levels of revenue and capacity.
“We expect that both the overall industry and our airline will be considerably smaller for some time, which will unfortunately result in significant reductions in both fleet and employee levels,” Rovinescu stated.
Since March 16th, Air Canada has reduced its flight schedule by 90 per cent.
Last month, the airline announced that it would be suspending service to the U.S. after as a result of the agreement between the governments of Canada and the United States to extend border restrictions by an additional 30 days.
Air Canada has plans to resume service to the U.S. on May 22nd.
In lieu of passengers, Air Canada has recently taken to shipping cargo to assist with the global requirements of goods and personal protective equipment during the pandemic.
Since March 22nd, the airline has operated more than 500 all-cargo international flights and plans to operate up to 150 all-cargo flights per week in the second quarter.
Air Canada also recently adopted the Canada Emergency Wage Subsidy (CEWS) for most of its workforce which allowed it to return previously furloughed Canadian-based employees to its payroll for the March 15 to June 6, 2020 period.
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