Bullboard - Stock Discussion Forum Air Canada T.AC

Alternate Symbol(s): ACDVF

Industrials Airlines

Air Canada is an airline company. The Company is a provider of scheduled passenger services in the Canadian market, the Canada-United States (U.S.) transborder market and the international market to and from Canada. It provides scheduled service directly to more than 180 airports in Canada, the United States and internationally on six continents. The Company’s Aeroplan program is Canada's... see more

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TSX:AC - Post Discussion

Air Canada > Answers i was waiting for

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Post by lb1temporary on May 07, 2021 1:25pm

Answers i was waiting for

TD: Conference Call highlights.

Event

This morning, Air Canada hosted a conference call to discuss its Q1/21 results released this morning, and the outlook for the business. We present the key takeaways from the call below.

Impact: NEUTRAL

Demand outlook:

Management called on the Government of Canada to provide a re-opening plan so that customers can have clarity for booking flights and airlines can accommodate the resulting demand.

Management continues to expect the domestic market to lead the recovery, but also highlighted some pockets of strength for sun destinations later this year and into early 2022, and VFR demand on certain Atlantic markets.

Expectations are for the summer peak, which typically occurs in July-August, to be pushed out slightly to September-October. Contingent upon continued vaccination rollout, reduced cases, and changes to government travel restrictions.

Management is optimistic about corporate travel beginning to recover post-Labour Day based on conversations with the largest corporate customers. Believes there is pent-up demand for corporate travel.

Given the currently depressed load factors, management believes there is enough capacity to quickly adapt to a surge in demand without having to bring back additional aircraft. Beyond this, aircraft are parked that are in operational condition, pilots are trained and ready to fly, and flight attendants can be brought back relatively quickly once demand recovers more than current capacity can handle. Longer-term, there are options on A220 and 737 MAX aircraft and the ability to source new aircraft (purchased or leased) as demand recovers towards 2019 levels and beyond.

Balance sheet and liquidity:

Customers requesting cash refunds for non-refundable fares on flights cancelled due to COVID-19 have been less than anticipated following the change in refund policy that came alongside the Government of Canada support package in April.

The company has flexibility to repay government debt with other sources of capital if prudent, and it has additional collateral and its loyalty plan as sources of untapped liquidity.