Transat revenue up double digits, net loss widens in its Q2 results

Air Transat revenues were up 11.8% year-on-year (YoY) to $973.2 million in its second quarter 2024 ending April 30, 2024. Though, its total operating expenses were up 16.1% YoY to $988.4 million, resulting in a net loss of $54.4 million, versus $29.2 million in second quarter 2023. ""Transat delivered double-digit revenue growth for a second consecutive quarter on the strength of increased customer traffic. On the profitability side, adjusted EBITDA declined to $38 million in the second quarter due to well-documented industry-wide and company-specific issues,"" said Air Transat president and CEO Annick Guerard. The increase in revenues had largely been attributed to sustained demand for leisure travel with a 12% increase in revenue passenger miles (RPMs). Though, this was hindered by economic slowdown, intensified competition, and threats of union strikes. In addition, the Pratt & Whitney GTF engine issues had impacted its revenue management. Its yields were down 7.5% YoY, with its load factor down 0.6 percentage point to Its adjusted EBITDA was $37.6 million, down from $56.1 million in the same quarter last year. Its cash and equivalents at the end of the quarter was at $528.9 million, up 21.4% from the end of October 2023. Comparing the same period, its total net debt was down 12.8% to $1.4bn. It made an early repayment of $36.3 million subordinated debt in the quarter which was due April 29, 2025. Its total loan repayments equal approximately $110 million in the last three quarters. It also extended the maturity of its secured debt from April 2025 to February 2026 in order to have ""added flexibility to secure a refinancing agreement,"" said Transat CFO Jean-Francois Pruneau. Guerard added: ""We are fully prepared from an operational standpoint for the summer season. As such, we recently completed the process of bringing in-house passenger and ramp services at Montreal-Trudeau International Airport to enhance the customer journey."" Air Transat had launched a joint venture with Porter Airlines earlier in June, which will allow travellers to use each partner’s distribution channels to book direct and connecting flights. It will also receive seven aircraft in the coming weeks, including A321LRs.