Paris attacks have slowed travel bookings, but upswing expected: Transat AT CEO

MONTREAL -- Last month's terrorist attacks in Paris have caused a chill in travel from Canada to the French capital but the impact is expected to be temporary, tour operator Transat AT said Thursday.

See Full Article

"It's normal but we don't see that (continuing)," Transat CEO Jean-Marc Eustache told analysts on a conference call.

Eustache referred to a much greater chill after the Sept. 11, 2001, terrorist attacks in the United States that caused the airline to ground 25 per cent of its aircraft, reduce staff and cut salaries.

"It was the worst that had ever happened in the world and (within six months) I was hiring everybody back," Eustache said.

Transat declined to provide details about the size of the sales decline since the Nov. 13 co-ordinated attacks in Paris that killed 130 and injured hundreds more.

But it said the decline in bookings has mostly affected flights before Christmas. Bookings for flights early in the new year and for the coming summer are running ahead of last year.

Before the Paris attacks, Transat (TSX:TRZ) posted a strong summer season, earning $69.1 million in the three months ended Oct. 31, up from $30.6 million a year ago.

Excluding the impact of fuel-hedging, restructuring and asset impairments, Transat earned $54.8 million or $1.44 per diluted share. That was up from $49.4 million or $1.27 per share a year earlier and above analyst estimates of $1.23.

Revenues decreased 0.6 per cent to $839.2 million, as lower fuel costs triggered a decline in average selling prices.

"Our summer results at a time when global capacity was up seven per cent on the transatlantic market are the second-best we ever recorded and are part of Top 5 summer results all achieved in the in last six years," chief financial officer Denis Petrin said.

For the full year ended Oct. 31, adjusted profits fell five per cent to $42.9 million or $1.11 per diluted share as revenues decreased about $200 million to $3.6 billion.

The company said it is hoping to improve its financial performance in the upcoming winter season, which runs until the end of April, after several years of losses, even as it expects operating costs to rise four per cent as the weaker Canadian dollar more than offsets the benefit from lower fuel costs.

Sales of packages to Transat's large market in Cuba are holding up even though Cuban hotels have tied their prices to the U.S. dollar, resulting in increases of up to 15 per cent for Canadians because of the loonie's depreciation.

Transat's top three markets -- Mexico, Dominican Republic and Cuba -- account for 90 per cent of its traffic over the winter.



Advertisements

Latest Economic News

  • Nortel Canada to start paying billions to creditors

    Economic CBC News
    Nortel Canada's long-suffering creditors will finally begin to receive their share of more than US$4 billion to be distributed under a plan approved in January, eight years after the former technology titan began bankruptcy proceedings. Nortel Networks Corp. Source
  • Nortel Canada to start paying billions to creditors; first instalment by July

    Economic CTV News
    TORONTO - Nortel Canada's long-suffering creditors will finally begin to receive their share of more than US$4 billion to be distributed under a plan approved in January, eight years after the former technology titan began bankruptcy proceedings. Source
  • Que. construction strike: Day 3 kicks off with little to show at bargaining table

    Economic CTV News
    MONTREAL -- There is little progress to report at the table as Quebec's construction strike enters Day 3. Eric Cote, a spokesman for one association of employers, says negotiations resumed late Thursday and that representatives for his group emerged early today suggesting they were a waste of time. Source
  • Ford's ex-CEO leaves company with $51.1M US

    Economic CBC News
    Ford's former CEO Mark Fields is leaving the company with an estimated $51.1 million US in cash, stock awards and pension benefits. Fields, 56, retired earlier this week after three years as CEO. Ford made record profits during his tenure but its stock price dropped nearly 40 per cent on investors' concerns about the company's future. Source
  • Ford's ex-CEO leaves company with US$51.1 million

    Economic CTV News
    DETROIT -- Ford's former CEO Mark Fields is leaving the company with an estimated US$51.1 million in cash, stock awards and pension benefits. Fields, 56, retired earlier this week after three years as CEO. Source
  • Feds run $21.8B deficit in 16-17, putting them close to target: early analysis

    Economic CBC News
    A preliminary analysis of the federal books suggests the government ran a 2016-17 deficit of $21.8 billion to put the Liberals close to their projection for the fiscal year. The Trudeau government's spring budget projected a shortfall of $23 billion for the fiscal year, without counting a $3-billion risk adjustment added to the accounting framework. Source
  • U.S. GDP reading for start of year revised upward, but still weak

    Economic CBC News
    The U.S. economy started 2017 out with a whimper, but it wasn't quite as weak as first thought. The government revised up its January-March growth reading to a rate of 1.2 per cent — better than an earlier estimate of 0.7 per cent but well below President Donald Trump's ambitious growth targets. Source
  • BlackBerry expecting US$940 million in Qualcomm dispute resolution

    Economic CTV News
    WATERLOO, Ont. -- BlackBerry Ltd. (TSX:BB) says it will receive US$940 million from Qualcomm by May 31 to settle a dispute over royalty payments. An arbitrator sided with BlackBerry in April, and announced an interim award of US$814.9 million plus additional amounts for interest and legal fees. Source
  • World shares weaken ahead of G7 meeting; oil bottoms out

    Economic CTV News
    HONG KONG -- World stock markets weakened Friday as investors awaited the upcoming G-7 summit and oil prices rebounded somewhat as markets shook off initial disappointment over a production cut deal. KEEPING SCORE: European shares opened lower, with France's CAC 40 down 0.8 per cent to 5,297.13 and Germany's DAX lost 0.5 per cent to 12,561.85. Source
  • TSX slips, U.S. markets nearly flat ahead of holiday weekend

    Economic CTV News
    TORONTO -- North American stock markets were generally lower in late-morning trading, but only modestly. The S&P/TSX composite index fell 22.03 points to 15,388.70, after 90 minutes of trading. In New York, the Dow Jones industrial average lost 12.32 points to 21,070.63. Source