Transat AT posted its second quarter results on Thursday (June 10), reporting a net loss attributable to shareholders of $69.6 million or $1.84 per diluted share.
The company also announced its plan to gradually resume operations starting July 30 after months of suspending service to Mexico and the Caribbean due to a grounding agreement it, and other Canadian carriers, made with the Government of Canada on Jan. 29.
“We hope that a safe travel recovery plan can be deployed as soon as possible and will lead to a lifting of restrictions in the near future,” said Annick Guérard, president and Chief Executive Officer at Transat, in a statement. “All indications are that our customers are eager to make use of some of their savings from recent months to travel. We're excited about welcoming them back soon.”
Transat’s results compared with a loss of $179.5 million or $4.76 per diluted share a year earlier at the start of the global pandemic.
Guérard said the financing Transat has secured will allow the company to roll out a plan over the coming years.
“Our strong brand, our employees' commitment and the transformation we have undertaken and which will continue over the coming years will allow us to position ourselves again as our customers' favourite leisure travel company and become more profitable than before the pandemic," she added.
Revenue for Transat’s second quarter totalled $7.6 million, down from $571.3 million in the same quarter last year.
“Preserving cash is a priority," Transat said in a release, noting that it has completed its efforts to obtain long-term financing.
The available financing represents a maximum of $820.0 million, of which $220.0 million was drawn as at April 30, 2021.
As at April 30, 2021, cash and cash equivalents amounted to $346.1 million, compared with $733.7 million on the same date in 2020.
This decrease was mainly attributable to a significant decrease in business, partially offset by the $170.0 million drawdown on the credit facilities.
Talks with PKP continue
Since the termination of the arrangement agreement with Air Canada, Transat has implemented a strategic plan, the company said, noting that discussions with Mr. Pierre Karl Péladeau, who previously implied he had lost interest in acquiring the company, are continuing.
End of hotel division
On May 20, 2021, due to the decline in liquidity as a result of the COVID-19 pandemic, Transat's Board of Directors approved the discontinuation of the hotel division's operations to refocus on the airline business.
Transat will implement certain changes, including plans to refocus operations and redefine the network by ensuring a greater presence in Eastern Canada and Montréal.
The company also says it plans to increase efficiency by streamlining its fleet and bringing its average age down, around two types of Airbus aircraft, improving aircraft usage, reducing seasonal fluctuations and enhancing revenue management practices.
The updates comes after Jean-Marc Eustache, one of the principal architects of the creation of Transat in 1987, announced his retirement from the company as president and CEO last month.
Mr. Eustache handed the leadership over to Annick Guerard on May 27. Guerard was previously Transat's Chief Operating Officer since November 2017.
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