Air Canada Reports Quarterly Losses, Revenue Increase

Air Canada reported a quarterly net loss of C$203 million ($199.6 million), but an increase in operating income of C$75 million ($73.5 million), a considerable improvement over last year’s operating loss of $113 million ($110.8 million).

Calin Rovinescu, president and chief executive officer of Air Canada, credited the turnaround on the airline’s efforts to maximize revenues and reduce costs along with the gradual economic recovery. “Although we are not at 2008 levels, premium revenue and yields have increased over the past two quarters,” he said.

Passenger revenues increased to C$256 million ($251.3 million), or 12 percent, from the second quarter of 2009 due to an 8.7 percent growth in traffic and a 3.3 percent improvement in yield. Premium cabin revenue growth accounted for almost half the total year-over-year increase in system passenger revenues in the second quarter of 2010, driven by a 15.8 percent increase in traffic and a 12.9 percent yield improvement.

A gradual return of business traffic together with initiatives undertaken to improve revenue quality, one of Air Canada’s 2010 key priorities, led to this strong improvement in premium cabin yield.