Air Canada Reports 2011 Q1 Loss - $66 Million

[yyz monkey]

http://www.newswire.ca/en/releases/arch ... c9593.html

[invertedattitude]

So in 300 words or less, why is Westjet making money and Air Canada is not

[whiteguy]

So in 300 words or less, why is Westjet making money and Air Canada is not

Because AC is in contract negotiations and WJ is not! Don't worry though WJ time will come.

[Rockie]

So in 300 words or less, why is Westjet making money and Air Canada is not

Superior management.

[Norwegianwood]

So in 300 words or less, why is Westjet making money and Air Canada is not

Superior management.

It's the age old "shell game" and they are really good at it! Look at the "Chorus (bottom) line" (Old Jazz income fund) and see where the profit went to..................... SOSDD

[bearinmind]

HOLLY CRAP, this came out of nowhere!!! Wish we knew before we turned down that deal that we were loosing so much money! Wish someone had warned us about this! Wait a minute...

[quote="bearinmind"]Its also important to remember that the company has always been successfull in looking like they are loosing money, asking the employee's for more work for less money..

Its 3 card monte, dont fall for it.

This is part of the tactic and the timing of the loss results are key to the vote being forced on us. Here is a big part of the story...

MONTREAL, May 5 /CNW Telbec/ - Air Canada today reported a first quarter operating loss of $66 million compared to an operating loss of $136 million in the first quarter of 2010, a $70 million improvement. Earnings before interest, taxes, depreciation, amortization and impairment, and aircraft rent (EBITDAR) of $207 million increased $57 million from the first quarter of 2010.


The stock has doubled since this time last year, all the projections are looking positive and increases in revenue, and seats are expected.

With this headline I would expect the company side of the table to tell us to expect less than the current offer. We need to send a message, that whats on the table is completely unacceptable. The higher percentage of voters turn out and vote no, the better the next offer will be. Everybody needs to vote and vote NO.

[rudder]

LCC will have a separate O/C.

No mention of any other labour group than pilots as requiring consent (clearly scope related).

Surprised that none of the analysts pointed out that for an LCC possibly the worst aircraft would be a 319 (per seat cost very high).

Pretty clear that the bait for the pilots is promotional opportunities that flow from growth (i.e. no LCC - no growth). But at what cost?

LCC is ZIP on steroids. And even the anaysts picked up on potential market cannibalization. It will therefore be impossible to operate AC and LCC on the same city pair.

No hint at the AGM of any insolvency issues at AC. Wants to 'mark to market' the employee pension benefits. Seems willing to bet the farm on LCC but with many, many conditions (wants cost certainty forever). Pretty clear will not accept any scenario where work rules, pay, pension, or benefits can be clawed back over time to mainline standards at LCC.

[Thirteentennorth]

So in 300 words or less, why is Westjet making money and Air Canada is not

Because of the ACPPA [that's Air Canada Public Participation Act]. AC is hamstrung with operating constraints imposed by the government, WJ is not.

[Bored]

So in 300 words or less, why is Westjet making money and Air Canada is not

How much went out the side door to Chorus, Aeroplan etc?
How much in bonuses, salaries and stock otions for execs that lost money in the qtr?
How much to service Milton and that dweeb that followed him's pensions?
etc etc

[FICU]

I would hazard a guess that employee pensions, the high wages for unskilled labour(CSA, ramp crew, etc), and the huge dollars and benefits going to executives is the main cost difference between WJ and AC.

A long road ahead to be cost competitive with WJ!

[Doug Moore]

Let's not get too excited here lads! Has AC ever posted a profit in the first quarter?

[kevind]

Old timers might remember WKRP... Funny TV show.

But

In the last season the station was finally making money. The owner then changed it to old folks music station. She told Andy the station manager. "What you dont understand is that WKRP is supposed to lose money"

Now, the question is? Does the ownership of air canada want it to lose money? The write off can help other parts of their business.

[invertedattitude]

So in 300 words or less, why is Westjet making money and Air Canada is not

Because AC is in contract negotiations and WJ is not! Don't worry though WJ time will come.

While no business is bulletproof, I've been hearing that same line since 1996... Still waiting.

Moving on, are some of you suggesting then that the rest of the year should be expected to be profitable?

[CanadianEh]

Old timers might remember WKRP... Funny TV show.

But

In the last season the station was finally making money. The owner then changed it to old folks music station. She told Andy the station manager. "What you dont understand is that WKRP is supposed to lose money"

Now, the question is? Does the ownership of air canada want it to lose money? The write off can help other parts of their business.

You make a very good point

Farmers do this all the time, they try to show either $0 profit or a net loss to keep the taxman away, but the money is actually just
being put to good use elsewhere in the business. Unfortunately, when a business like Air Canada has shareholders that strategy doesn't bode with shareholders well especially if there's no dividend.

But seriously, other than when you have shareholders to please, what's the point of posting a huge profit only to have 18% (or whatever the corporate tax rate is) given to the gov't?

[CanadaEH]

I don't usually call people stupid but anyone that suggests AC is losing money on purpose is stupid. Aside from conspiracy theories and wild assumptions and insinuations, why on earth would a publicly traded Company do that!?

[Mig29]

Air Canada is expecting to increase their flying this summer by around 500,000 seats!

Don't worry, AC is not going anywhere, as much as some people are trying to convince you otherwise.

[ogc]

That was only the loss on "operations"

The company actually only reported an "adjusted" loss of (19) million after foreign currency gains.

[justwork]

Old timers might remember WKRP... Funny TV show.

But

In the last season the station was finally making money. The owner then changed it to old folks music station. She told Andy the station manager. "What you dont understand is that WKRP is supposed to lose money"

Now, the question is? Does the ownership of air canada want it to lose money? The write off can help other parts of their business.

WKRP might not supposed to make money, farmers want to keep it close on paper, publicly traded companies are not supposed to lose money... over and over and over. Air Canada is publicly traded anomaly though.

[yycflyguy]

Old timers might remember WKRP... Funny TV show.

But

In the last season the station was finally making money. The owner then changed it to old folks music station. She told Andy the station manager. "What you dont understand is that WKRP is supposed to lose money"

Now, the question is? Does the ownership of air canada want it to lose money? The write off can help other parts of their business.

WKRP might not supposed to make money, farmers want to keep it close on paper, publicly traded companies are not supposed to lose money... over and over and over. Air Canada is publicly traded anomaly though.

... unless those "losses" are actually just being funnelled out the back door through a CPA.... or unless those "losses" are a result of unlocking shareholder value and distributing dividends to shareholders when you can't afford to do it.

Stock price has almost tripled from when CR took over and it was under $1. He has thousands of shares and wants to see the stock rise. Good incentive for a CEO IMO.

Jazz negotiated a nice raise and guaranteed their DB plans. Management secured their DB plans.

Our load factor's have been in the mid 80's for 3 years.

Low yield routes have been turfed or split amongst Star Alliance members.

The money is there. Don't be fooled