MONTREAL, May 10, 2024 /CNW/ – Transat A.T. Inc. (“Transat” or the “Corporation“) announced today that it will likely not achieve its adjusted EBITDA margin¹ forecast for fiscal 2024.

Persistent operational challenges related to Pratt & Whitney’s GTF¹engines, market dynamics leading to downward pressure on airline unit revenues (yield), and the consequences of union strike threats, have created a particularly volatile environment. Although the situation may evolve in upcoming months, the current trend places the Corporation on a trajectory to achieve an adjusted EBITDA margin of approximately 5% for fiscal 2024.

Given these factors, the Corporation has deemed it prudent to no longer issue guidance on this metric in the future.

The Corporation will provide further information about its performance and strategies during the second quarter earnings call on June 6^th.

About Transat

Founded in Montreal 36 years ago, Transat has achieved worldwide recognition as a provider of leisure travel particularly as an airline under the Air Transat brand. Voted World’s Best Leisure Airline by passengers at the 2023 Skytrax World Airline Awards, it flies to international destinations. By renewing its fleet with the most energy-efficient aircraft in their category, it is committed to a healthier environment, knowing that this is essential to its operations and the destinations it serves. Transat has been Travelife-certified since 2018.

MONTRÉAL, April 30, 2024 /CNW/ – Airline Dispatchers at Air Transat represented by the Canadian Airline Dispatchers Association (CALDA) have given their association a resounding 100% strike mandate in their negotiations with Air Transat. The result of the Strike Vote was delivered to Air Transat on April 15^th after Conciliation talks with the assistance of the Federal Government failed and Conciliation ended on April 2^nd, 2024. The 21 day mandatory cooling off period ended April 23^rd, 2024. . The 28 Montreal based Air Transat Flight Dispatchers are very disappointed at the progress of talks. Air Transat Flight Dispatchers Collective Agreement ended on October 31^st, 2022.

“We have been very patient in trying to negotiate a new Collective Agreement with Air Transat”, said Rob King, National President, Canadian Airline Dispatchers Association. “Our Flight Dispatchers are highly trained professionals who certain deserve a contract that reflects their position of responsibility, accountability and liability as it pertains to their work,” said King. The Flight Dispatchers are now in a position to strike.

Flights Dispatchers are licensed by Transport Canada and prepare the Flight Plan, board fuel, monitor aircraft systems, monitor weather, deal with in-flight emergencies along with other very important functions. The Flight Dispatcher at Air Transat shares responsibility with the Pilot-In-Command for Flight Watch and Operational Control. Both the Flight Dispatcher and the Pilot-In-Command share pertinent information with each other to ensure the Flight is operated in the safest manner possible. No Air Transat aircraft can depart without the approval of the Flight Plan by the Flight Dispatcher.

MONTREAL, March 19, 2024 /CNW/ – Air Transat, voted World’s Best Leisure Airline for the fifth time at the 2023 Skytrax World Airline Awards, is pleased to announce the expansion of its virtual interlining service with the addition of two new airline partners. Its innovative connectair by Air Transat platform now enables travellers to combine Air Transat flights with those of Pegasus Airlines and Volotea, bringing the total to 14 collaborating airlines and offering unprecedented access to over 275 additional destinations worldwide.

The association with Pegasus Airlines opens up exciting travel opportunities to multiple Turkish coastal hotspots such as Istanbul and Antalya. In addition, the partnership with Spanish carrier Volotea offers gateways to an array of destinations across Europe and Africa, such as Olbia in Italy, Oran in Algeria, and Strasbourg in France, enriching Air Transat’s network with diverse cultural and scenic landscapes.

Connections are available through the search engine on airtransat.com and through some flight aggregators. The booking also includes an assistance service in case of flight delay or cancellation, ensuring that travellers arrive at their destination as quickly as possible.

To learn more about connectair by Air Transat, travellers are invited to visit airtransat.com or watch this short video.

About Air Transat
Founded in Montreal 36 years ago, Air Transat is a leading travel brand voted World’s Best Leisure Airline by passengers at the 2023 Skytrax World Airline Awards. Its program offers access to international destinations, mainly in Europe, the Caribbean, the East and West coasts of the U.S, South America and North Africa. Air Transat is recognized for its excellent customer service. By renewing its fleet with the most energy-efficient aircraft in their category, Air Transat is committed to a more sustainable travel industry. Based in Montreal with major hubs in YUL Montréal-Trudeau International Airport and Toronto Pearson Airport (YYZ), it has near 5,000 employees with a common purpose to bring people closer together. Air Transat is a business unit of Transat A.T. Inc. (TSX: TRZ). www.airtransat.com

About Pegasus Airlines
Incorporated in 1990, Pegasus was acquired by ESAS Holding in 2005 and adopted the low-cost business model. As Türkiye’s leading low-cost airline, Pegasus believes that everyone has the right to fly and offers its guests the opportunity to travel with good-value fares and young aircraft through its low-cost model. In 2018, Pegasus adopted the motto Your Digital Airline and carries its guests to 136 destinations in 51 countries, 36 in Turkey and 100 international. Pegasus operates connecting flights between Türkiye and Europe, North Africa, the Middle East and Central Asia via Istanbul Sabiha Gökçen and Antalya. Pegasus offers digital technologies and unique innovations that enhances the guest experience and makes comprehensive efforts for a cleaner, more equal, and harmonious future together, with the mission of Moving Towards a Sustainable Future. For further information on why sustainability is important to Pegasus and its activities in this area, please see the Pegasus Airlines Sustainability Hub. 

About Volotea
Volotea is one of the fastest-growing independent airlines in Europe in the last decade, increasing its fleet, routes served, and seats offered year-on-year. This year, the airline will celebrate a milestone of carrying 60 million passengers throughout its network.

This year, Volotea will operate nearly 450 routes (with over half exclusive), offer between 12.5M and 13M seats, and fly approximately 80,000 flights with an expanded fleet of 44 Airbus A319 and A320.

Volotea is working towards achieving a more sustainable future in aviation and is on track to reduce direct CO2 emissions per passenger-kilometer by 50% by 2025, five years ahead of schedule, setting a new and even more ambitious goal to decrease emissions by 58% by 2030. Volotea has launched over 50 sustainability initiatives to date, reducing its carbon footprint per passenger-kilometer by more than 45%. The airline is dedicated to developing emission-free technologies and collaborating with manufacturers and the industry to expand the use of sustainable aviation fuel.

Reaching a project workforce of approximately 2,000 employees this year, Volotea enhances connectivity and contributes to its region’s economic and cultural development. The airline was recognized by Skytrax as the “Best Low-Cost Airline in Europe” at the 2023 World Airline Awards.

MONTREAL, March 18, 2024 /CNW/ – Transat A.T. Inc. (“Transat”) is pleased to announce the appointment of Sebastian Ponce as Chief Revenue Officer. He is now responsible for the air network strategy, revenue management, and the development of airline alliances.

At Transat since 2018, Sebastian most recently held the position of Vice President, Program and Alliances. With his team, he was instrumental in redefining Transat’s network and alliance strategy and in setting up the Alliances department, responsible for developing and maintaining airline partnerships. He has also spearheaded numerous inter-carrier partnership agreements, including the recent commercial joint venture with Porter Airlines, a first in the company’s history. Under his leadership, Transat announced two codeshare agreements with Canadian airlines and a dozen interline agreements with carriers in Europe and South America.

“Sebastian joined Transat as part of its strategic transformation with the objective of defining our network for years to come. He has a strong track record and has demonstrated great potential in a number of ways. I am confident that he is the right person to continue implementing our growth strategy over the next few years,” said Annick Guérard, President and Chief Executive Officer of Transat.

“I am delighted to take on this new role and to further contribute to the development of our business model. There are many opportunities to continue growing our network and optimizing our revenues, and I am eager to be actively involved in the initiatives that will help us achieve our goals,” added Sebastian Ponce.

Sebastian has over 15 years of experience within the airline industry, 10 of which he spent at Air France. Throughout his career, he has led various teams in the Revenue Management, Controlling, Airport Strategy, Network Planning and Alliances departments.

Sebastian holds an Executive MBA from McGill and HEC Montréal and a master’s degree in industrial engineering from Universidad Tecnica Federico Santa Maria in Chili.

About Transat   

Founded in Montreal 36 years ago, Transat has achieved worldwide recognition as a provider of leisure travel particularly as an airline under the Air Transat brand. Voted World’s Best Leisure Airline by passengers at the 2023 Skytrax World Airline Awards, it flies to international destinations. By renewing its fleet with the most energy-efficient aircraft in their category, it is committed to a healthier environment, knowing that this is essential to its operations and the destinations it serves. Transat has been Travelife-certified since 2018. (TSX: TRZ) www.transat.com

First-quarter highlights:

• Revenues of $785.5 million, up 17.7% from $667.5 million last year
• Negative adjusted EBITDA of $8.6 million, compared to adjusted EBITDA of $3.3 million last year
• Net loss of $61.0 million ($1.58 per share), versus $56.6 million ($1.49 per share) last year
• Positive free cash flow of $39.1 million, compared to $144.2 million last year
• Proceeds from the sale of an investment in Mexico applied to reduce secured facilities by $20.7 million
• Record customer deposits for future travel of $1,026.9 million, up 14% from January 31, 2023

MONTREAL, March 14, 2024 /CNW/ – Transat A.T. Inc., a leisure travel reference worldwide, operating as an air carrier under the Air Transat brand, announced today its results for the First Quarter ended January 31, 2024.

“Transat’s first-quarter results reflect sustained demand for leisure travel. Revenues grew 17.7% year-over-year, driven by a solid traffic increase. However, the persisting speculation of a strike by flight attendants starting last November clearly affected bookings and yield for the winter season, and we are pleased that the adoption of a new collective agreement in late February removed this uncertainty. As for the operating challenges related to the Pratt & Whitney GTF² engine issue, costs incurred, including those related to the temporary leasing of additional aircraft, applied pressure on profitability. Finally, while demand remains sound, softer yields indicate heightened consumer price sensitivity in the current macro-economic environment as well as fierce price competition, especially in the Toronto market,” said Annick Guérard, President and Chief Executive Officer of Transat.

“In recent months, several industry-wide supply chain challenges, including the Pratt & Whitney GTF engine issue, have resulted in higher costs and the need to make certain capacity modifications going forward. These adjustments should limit capacity expansion to 13% in fiscal 2024, still representing a healthy increase compared to 2023. Accordingly, we now expect an adjusted EBITDA margin for the full year 2024 to be at the lower end of the range announced last December. Finally, the refinancing plan remains the organization’s top priority and discussions with stakeholders continue,” added Jean-François Pruneau, Chief Financial Officer of Transat.

First-quarter Results

For the three-month period ended January 31, 2024, revenues reached $785.5 million, up 17.7% from $667.5 million in the corresponding period a year ago. The increase reflects sustained demand for leisure travel driven by a 20% increase in traffic expressed in revenue-passenger-miles (RPM). However, this increase was mitigated by persistent speculations throughout the quarter about a potential strike by the flight attendants. Company-wide capacity was up 25% from last year, while airline unit revenues (yield) was down 3.1%.  

Negative adjusted EBITDA¹ stood at $8.6 million, compared with an adjusted EBITDA¹ of $3.3 million a year ago. The variation is mainly due to higher operating expenses associated with capacity expansion, such as increases in the cost of providing tourism services, wages and benefits, and aircraft-related expenses, the latter also including, among other things, (i) costs related to the operating challenges caused by the Pratt & Whitney GTF engine issue and (ii) an unfavorable year-over-year aircraft maintenance calendar due to the low aircraft utilization during the pandemic. These factors were partially offset by lower fuel expenses reflecting a price decline of 18% compared to last year.

Cash flow and financial position

Cash flow from operating activities amounted to $110.7 million during the First Quarter of 2024, compared with $195.1 million for the same period last year, due to a less favorable net change in non-cash working capital balances and to a greater operating loss this year. After accounting for investing activities and repayment of lease liabilities, free cash flow¹ reached $39.1 million during the quarter, versus $144.2 million a year earlier.

As at January 31, 2024, cash and cash equivalents amounted to $453.3 million, compared to $467.7 million at the same date in 2023 and $435.6 million as at October 31, 2023. Cash and cash equivalents in trust or otherwise reserved mainly resulting from travel package bookings improved year-over-year reaching $612.2 million as at January 31, 2024, compared with $523.8 million at the same date in 2023.

Reflecting sound demand, customer deposits for future travel stood at an all-time record level of $1,026.9 million as at January 31, 2024, up 14% from January 31, 2023.

During the quarter, the Corporation completed the previously announced sale of an investment in a hotel in Mexico and proceeds were applied to reduce secured facilities by $20.7 million. Following this repayment, long-term debt and deferred government grant, net of cash, amounted to $352.3 million as at January 31, 2024, down from $375.3 million a year ago and from $380.1 million as at October 31, 2023.

Outlook

Early trends for the summer season indicate bookings and pricing conditions that are largely in line with the same period last year. However, as the Corporation does not foresee the same uplift in yields that was exhibited throughout the summer season last year, it will remain proactive in managing costs under its control, while actively seeking to mitigate the structural cost increases affecting the industry.

Given the current operating environment, the Corporation revised its fiscal 2024 capacity expansion plans to 13%, versus 19% previously.

Reflecting the above, the Corporation now expects its adjusted EBITDA¹ margin for the full year 2024 to be at the lower end of the range of 7.5% to 9.0% announced last December. In making these forward-looking statements, the Corporation used the following assumptions for the fiscal year: weak GDP growth in Canada, an exchange rate of C$1.34 to US$1 and an average price per gallon of jet fuel of C$4.00. 

Conference call

First-quarter 2024 conference call: Thursday, March 14, 10:00 a.m. To join the conference call without operator assistance, you may register and enter your phone number here to receive an instant automated call back.

You can also dial direct to be entered into the call by an operator:
Montreal: 514-225-7344
North America (toll-free): 1-888-390-0620
Name of conference: Transat
The conference will also be accessible live via webcast: click here to register. 

An audio replay will be available until March 21, 2024, by dialing 1 888 390-0541 (toll-free in North America), access code 776189 followed by the pound key (#). The webcast will remain available for three months following the call.

Second-quarter 2024 results will be announced on June 6, 2024.

Highlights and non-IFRS financial measures

Highlights and non-IFRS financial measures
	First quarter
	2024	2023
(in thousands of Canadian dollars, except per share amounts)	$	$
Operating loss	(52,429)	(38,103)
Depreciation and amortization	50,164	41,108
Reversal of impairment of the investment in a joint venture	(3,112)	—
Restructuring costs	66	2,900
Premiums related to derivatives that matured during the period	(3,314)	(2,574)
Adjusted operating income (loss)	(8,625)	3,331
Net loss	(60,977)	(56,610)
Reversal of impairment of the investment in a joint venture	(3,112)	—
Restructuring costs	66	2,900
Change in fair value of derivatives	22,159	9,921
Revaluation of liability related to warrants	11,747	10,139
Foreign exchange gain	(42,127)	(22,829)
Gain on disposal of an investment	(5,784)	—
Gain on asset disposals	—	(2,511)
Premiums related to derivatives that matured during the period	(3,314)	(2,574)
Adjusted net loss	(81,342)	(61,564)
Adjusted net loss	(81,342)	(61,564)
Adjusted weighted average number of outstanding shares used in computing diluted     earnings per share	38,580	38,065
Adjusted net loss per share	(2.11)	(1.62)
Cash flows related to operating activities	110,702	195,088
Cash flows related to investing activities	(28,745)	(10,481)
Repayment of lease liabilities	(42,864)	(40,457)
Free cash flow	39,093	144,150

	As at January 31, 2024	As at October 31, 2023
(in thousands of dollars)	$	$
Long-term debt	665,104	669,145
Deferred government grant	140,480	146,634
Liability related to warrants	32,563	20,816
Lease liabilities	1,138,407	1,221,451
Total debt	1,976,554	2,058,046
Total debt	1,976,554	2,058,046
Cash and cash equivalents	(453,286)	(435,647)
Total net debt	1,523,268	1,622,399

About Transat

Founded in Montreal 36 years ago, Transat has achieved worldwide recognition as a provider of leisure travel particularly as an airline under the Air Transat brand. Voted World’s Best Leisure Airline by passengers at the 2023 Skytrax World Airline Awards, it flies to international destinations. By renewing its fleet with the most energy-efficient aircraft in their category, it is committed to a healthier environment, knowing that this is essential to its operations and the destinations it serves. Transat has been Travelife-certified since 2018.  www.transat.com

MONTREAL, Feb. 26, 2024, Canadian Union of Public Employees (FTQ)  /CNW/ – Air Transat’s 2,100 flight attendants have a new collective agreement that makes them the highest paid in the industry in Canada. Following information meetings held from February 19 to 22, they voted by 62,7% to accept the recommendation of federal mediators. This new contract provides for total compound salary increases of 30% over five years, i.e. from November 1, 2022 to October 31, 2027.

It also provides for the abolition of the first two salary levels, meaning that flight attendants with less than three years of seniority will immediately access the third level, which represents a significant increase in salary.

In addition, this new collective agreement will secure the number of crew seats on all flights lasting 7 hours or more and those departing Canada after 10 p.m. It will also increase the number of personal leave days and vacation days.

“It’s been a long and complex process, but we’re finally crossing the finish line with substantial pay increases for our flight attendant members. This will be an extremely well-deserved adjustment after years of effort to help the company through financial difficulties, followed by the catastrophic years of the pandemic and a period of high inflation,” noted Chantal Bourgeois, CUPE National Representative.

The Air Transat Component encompasses two local unions based at airports in Montreal (YUL) and in Toronto (YYZ). It is part of CUPE’s Airline Division, which represents more than 18,500 flight attendants employed at Air Transat, Air Canada, Air Canada Rouge, Sunwing, WestJet, Encore, Calm Air, Canadian North, Pivot Airlines, Flair Airlines, PAL and Pascan.

CUPE is Canada’s largest union, with 740,000 members across the country. It represents workers in health care, emergency services, education, early learning and child care, municipalities, social services, libraries, utilities, transportation, airlines and more.

End of strike threat

MONTREAL, Feb. 26, 2024 /CNW/ – Air Transat announces today that 62.7% of its flight attendants have voted in favour of the Federal Mediation and Conciliation Service mediators’ recommendation, thus ratifying the new collective agreement and effectively lifting the strike threat, putting an end to the uncertainty for travellers. The collective agreement is retroactive to November 1, 2022, and will be valid until October 31, 2027.

“Our flight attendants play a key role in Air Transat’s success, and following an unprecedented process, we are pleased to offer competitive working conditions. This outcome will enable us to continue the dialogue of the past few months and move forward. We are also grateful for the patience and trust of our customers during these uncertain times,” says Julie Lamontagne, Chief People, Communications and Sustainability Officer of Transat.

About Air Transat

Founded in Montreal 36 years ago, Air Transat is a leading travel brand voted World’s Best Leisure Airline by passengers at the 2023 Skytrax World Airline Awards. Its program offers access to international destinations, mainly in Europe, the Caribbean, the East and West coasts of the U.S., South America and North Africa. Air Transat is recognized for its excellent customer service. By renewing its fleet with the most energy-efficient aircraft in their category, Air Transat is committed to a more sustainable travel industry. Based in Montreal with major hubs in YUL Montréal-Trudeau International Airport and Toronto Pearson Airport (YYZ), it has near 5,000 employees with a common purpose to bring people closer together. Air Transat is a business unit of Transat A.T. Inc. (TSX: TRZ). www.airtransat.com