MONTREAL, Aug. 21, 2017 /CNW Telbec/ - Transat A.T. Inc., one of the largest integrated tourism companies in the world and Canada's holiday travel leader, has revised its outlook and is preparing to announce results for the third quarter of 2017, ended July 31, that are substantially better than those factored in its most recent outlook, which was published along with its second-quarter results this past June 8.
Third-quarter revenues on both the transatlantic market – the Corporation's primary market in the summer months – and the Sun destinations market were superior to those posted last year, especially since mid-June.
In addition, the Corporation's airline costs were lower than expected, a trend reinforced by the combined impact of positive fluctuations in fuel prices and currency exchange rates.
Subject to finalization of its financial statements, the Corporation now expects that its third-quarter adjusted net income will be significantly higher than that recorded last year, and similar to that of 2015, when it posted adjusted net income from continuing operations for the period of $26.9 million.
The outlook provided above is a preliminary outlook, subject to preparation of Transat's accounts for the third quarter. The Corporation expects to issue an updated outlook for the fourth quarter along with its quarterly results announcement on September 7, and will issue no further comment or update until then. Please refer to the caution regarding forward-looking statements, below.
Transat A.T. Inc. is a leading integrated international tourism company specializing in holiday travel and active in air transportation, accommodation, travel packaging and distribution. It operates mainly in Canada, Europe, Mexico and the Caribbean, with some 25 destination countries, and distributes products in over 50 countries. Based in Montreal, the company has 5,000 employees. Transat is firmly committed to sustainable tourism development, as reflected in its multiple corporate responsibility initiatives over the past 10 years, and was awarded Travelife Partner status in 2016. The vacation travel companion par excellence, Transat celebrates its 30th anniversary in 2017 (TSX: TRZ).
Transat prepares its financial statements in accordance with International Financial Reporting Standards (IFRS). We will occasionally refer to non-IFRS financial measures in the news release. These non-IFRS financial measures do not have any meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. They are furnished to provide additional information and should not be considered as a substitute for measures of performance prepared in accordance with IFRS. All amounts are in Canadian dollars unless otherwise indicated.
Adjusted net income (adjusted net loss) is a non-IFRS financial measure used by management to assess Transat's ongoing and recurring operational performance. Adjusted net income (adjusted net loss) is the net income (loss) attributable to shareholders before net income (loss) from discontinued operations, change in fair value of fuel-related derivatives and other derivatives, gain (loss) on disposal of a subsidiary, restructuring charge, lump-sum payments related to collective agreements, asset impairment and other significant unusual items, and including premiums for fuel-related derivatives and other derivatives matured during the period, net of related taxes. The Corporation uses this measure to assess the financial performance of its activities before the items mentioned previously to ensure better comparability of financial results. Adjusted net income (loss) is also used in calculating the variable compensation of employees and senior executives.
Caution regarding forward-looking statements
This news release contains certain forward-looking statements regarding the Corporation, as defined in securities laws. In making these statements, the Corporation has assumed that the trends in reservations and selling prices will continue, and that fuel prices, other costs and the value of the Canadian dollar against foreign currencies will remain stable at the closing of the accounts. In particular, this news release contains forward-looking statements pertaining to the Corporation's financial results for the third quarter of fiscal 2017. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. If these assumptions prove incorrect, actual results and developments may differ materially from those contemplated by the forward-looking statements contained in this news release.
These forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by these forward-looking statements. Even though the Corporation considers the assumptions on which these forward-looking statements are based to be reasonable, it cautions the reader that these assumptions regarding future events, many of which are beyond its control, may ultimately prove to be incorrect and nothing guarantees that the real results will match these forward-looking statements. For additional information with respect to the risk factors the Company is subject to and other factors, see the Annual Information Form and Annual Report for the year ended October 31, 2016, filed with Canadian securities commissions. The forward-looking statements contained in this news release are made as of the date of this release and should not be relied upon as representing the Corporation's views as of any date subsequent to the date of this release. The Corporation disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by securities laws.
SOURCE Transat A.T. Inc.
Media: Christophe Hennebelle, Vice-President, Human Resources and Corporate Affairs, 514 987-1660, ext. 4584; Financial analysts: Denis Pétrin, Chief Financial Officer, 514 987-1660