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WJA and AC 4th qtr and 2018 year end results

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11:00 ETMedia Advisory - WestJet to present 2018 fourth quarter and year end financial results

CALGARY, Jan. 22, 2019 /CNW/ - WestJet will hold its quarterly analysts' conference call on Tuesday, February 5, 2019, at 8 a.m. MDT (10 a.m. EDT)...

Jan 21, 2019, 15:18 ETMedia Advisory - Air Canada to Present Fourth Quarter and Full Year 2018 Results

MONTREAL, Jan. 21, 2019 /CNW Telbec/ - Calin Rovinescu, Air Canada President and Chief Executive Officer, Michael Rousseau, Deputy Chief Executive... will hold a conference call for analysts onon Friday, February 15, 2019

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WestJet reports fourth quarter and full year results

 


News provided by

WESTJET, an Alberta Partnership

Feb 05, 2019, 06:30 ET

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CALGARY, Feb. 5, 2019 /CNW/ - WestJet (TSX: WJA) today announced its fourth quarter and year end results for 2018, with full year net earnings of $91.5 million, or $0.80 per fully diluted share. This compares with net earnings of $279.1 million, or $2.38 per fully diluted share in the full year 2017. In the fourth quarter of 2018 the airline achieved net earnings of $29.2 million, or $0.26 per fully diluted share. This result compares with net earnings of $47.8 million, or $0.41 per fully diluted share reported in the fourth quarter of 2017.

"In 2018 we executed several significant milestones on our path to becoming a high-value global network airline," said Ed Sims, WestJet President and CEO. "As we enter 2019, we continue to build momentum and are well-positioned to deliver on our strategic initiatives and expand margins. I would like to thank every WestJetter for their hard work through an especially busy holiday season culminating in our WestJet mainline business achieving the highest completion rate in North America in December, as measured by FlightStats."

Operating highlights (stated in Canadian dollars)

 

Q4 2018

Q4 2017

Change

Full year

2018

Full year

2017

Change

Net earnings (millions)

$29.2

$47.8

(39.0%)

$91.5

$279.1

(67.2%)

Diluted earnings per share

$0.26

$0.41

(36.6%)

$0.80

$2.38

(66.4%)

Total revenue (millions)

$1,193.3

$1,119.1

6.6%

$4,733.5

$4,506.7

5.0%

Operating margin

4.1%

6.9%

(2.8 pts)

3.3%

9.6%

(6.3 pts)

ASMs (available seat miles) (billions)

8.109

7.659

5.9%

32.939

30.998

6.3%

RPMs (revenue passenger miles) (billions)

6.615

6.329

4.5%

27.587

25.904

6.5%

Load factor

81.6%

82.6%

(1.0 pts)

83.8%

83.6%

0.2 pts

Segment guests

6,185,541

6,010,069

2.9%

25,491,290

24,137,477

5.6%

Yield (revenue per revenue passenger mile) (cents)

18.04

17.68

(2.0%)

17.16

17.40

(1.4%)

RASM (revenue per available seat mile) (cents)

14.72

14.61

0.7%

14.37

14.54

(1.2%)

CASM (cost per available seat mile) (cents)

14.11

13.61

3.7%

13.90

13.14

5.8%

Fuel costs per litre (cents)

83

69

20.3%

81

64

26.6%

CASM, excluding fuel and employee profit share (cents)*

10.29

10.26

0.3%

10.11

9.93

1.8%

   
 

*Refer to reconciliations in the accompanying tables for further information regarding calculations.

Note: All values in the above table are at a consolidated WestJet group level

Dividend declaration
On February 4, 2019, WestJet's Board of Directors declared a cash dividend of $0.14 per common voting share and variable voting share for the first quarter of 2019, to be paid on March 29, 2019, to shareholders of record on March 13, 2019. All dividends paid by WestJet are, pursuant to subsection 89(14) of the Income Tax Act, designated as eligible dividends, unless indicated otherwise. An eligible dividend paid to a Canadian resident is entitled to the enhanced dividend tax credit.

Caution regarding forward-looking information
Certain information set forth in this news release is forward-looking information within the meaning of applicable securities laws. By its nature, forward-looking information is subject to numerous risks and uncertainties, some of which are beyond WestJet's control. The forward-looking information contained in this news release is based on WestJet's current forecasts and strategy, the expected demand environment, the utilization of our fleet, the forward-curve for jet fuel price, the expected exchange rate of the Canadian dollar to the U.S. dollar, agreements and bookings, but may vary due to factors including, but not limited to, changes in guest demand, changes in fuel prices, delays in aircraft delivery, general economic conditions, competitive environment, ability to effectively implement and maintain critical systems and other factors and risks described in WestJet's public reports and filings which are available under WestJet's profile at sedar.com. Readers are cautioned that undue reliance should not be placed on forward-looking information as actual results may vary materially from the forward-looking information. WestJet does not undertake to update, correct or revise any forward-looking information as a result of any new information, future events or otherwise, except as may be required by applicable law.

Non-GAAP measures
This news release contains disclosure respecting non-GAAP performance measures including, without limitation, CASM, excluding fuel and employee profit share and return on invested capital. These measures are included to enhance the overall understanding of WestJet's current financial performance and to provide an alternative method for assessing WestJet's operating results in a manner that is focused on the performance of WestJet's ongoing operations, and to provide a more consistent basis for comparison between reporting periods. These measures are not calculated in accordance with, or an alternative to, GAAP and do not have standardized meanings. Therefore, they may not be comparable to similar measures provided by other entities. Readers are urged to review the section entitled "Reconciliation of non-GAAP and additional GAAP measures" in WestJet's management's discussion and analysis of financial results for the year ended December 31, 2018 which is available under WestJet's profile on SEDAR at sedar.com, for a further discussion of such non-GAAP measures and a reconciliation of such measures to GAAP. The financial information accompanying this news release was prepared in accordance with International Financial Reporting Standards unless otherwise noted.

Management's discussion and analysis of financial results and consolidated financial statements and notes for the year ended December 31, 2018, are available through the Internet in the Investor Relations section of westjet.com or under WestJet's SEDAR profile at sedar.com.

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WestJet rises above Alberta’s economic turbulence

 

  • Calgary Herald
  • 6 Feb 2019
  • CHRIS VARCOE
img?regionKey=52MIFf9sSH3jxe3jUi2hQQ%3d%3dGAVIN YOUNG/FILES WestJet CEO Ed Sims says demand for flights remains strong in Alberta and across Canada.

Alberta’s economy is expected to slow this year because of weak energy prices and the effect of oil curtailment, yet one area appears to be cutting through the choppy headwinds.

Air travel. Calgary-based WestJet Airlines released its fourth-quarter results on Tuesday and is moving ahead on its international expansion plans, growing its new ultralow-cost carrier, and continuing efforts to contain costs after a bumpy ride in 2018.

One area that isn’t causing concern is the state of business on its home turf of Alberta.

Speaking on a conference call with analysts, WestJet CEO Ed Sims noted the province’s economy is expected to decelerate, with GDP growth slowing from 2.5 per cent last year to around 1.5 per cent in 2019.

A 30-per-cent decline in global oil prices since last fall and the province’s decision to restrict crude production are projected to limit Alberta’s economic expansion, although the drop is only expected to be temporary.

“We see a strong recovery for 2020 forecast, the highest in Canada still,” Sims said of the outlook for Alberta.

“Despite that (economic) dip and despite the impacts of pro-rationing on the energy industry, we are still seeing strong underlying demand, both in Alberta but right across Canada.”

Last week, the Calgary International Airport reported its strongest passenger growth since 2014, before oil prices collapsed and triggered a full-blown recession.

The number of passengers moving through the airport last year shot up by 6.6 per cent to top 17 million travellers.

More than one-third of all passengers were headed to other places and this trend has “recession-proofed” the facility, Calgary Airport Authority CEO Bob Sartor told Postmedia’s Amanda Stephenson.

Equally impressive is the fact that even with today’s economic pressures, the airport still expects traffic to increase by about one million travellers in 2019, in part because of WestJet’s international strategy.

The company will be flying three new Boeing 787 Dreamliner aircraft out of Calgary to European destinations — Dublin, Paris and London’s Gatwick Airport, beginning in late April — and it’s adding new direct flights into U.S. cities.

WestJet officials said Tuesday they are not seeing any hint of a slowdown or reduced bookings in the first quarter coming out of Edmonton or Calgary, and the corporate travel market continues to perform well.

During the 2015-16 recession, the company was squeezed by the sudden drop-off in Alberta business and leisure travel.

In response, WestJet cut its Alberta capacity by five per cent in 2016, shifting some planes to more profitable routes in other parts of the country.

The company estimates revenue from Alberta’s air industry fell by $1 billion from the peak of 2015 through the summer of 2018, but has since recovered by about $200 million.

Analyst Chris Murray of AltaCorp Capital said the company’s effort to move more traffic originating from outside the province — such as from British Columbia or the United States — through its Calgary hub is one way that WestJet “helps mitigate what directly happens in Alberta.”

And Alberta air travel isn’t deteriorating, as some had expected.

“While we have seen a bit of an (economic) downturn in Alberta, the demand for travel has still stayed fairly healthy,” Murray said.

“Air travel is a pretty good indicator of where we are heading and it looks like for the next three to six months, everyone is still thinking I am taking my winter vacation or, if needed, still travelling for business.”

The past 12 months have been a challenging period for the airline and Sims, who took over as CEO last March.

The company launched its new ultra-low-cost carrier Swoop last year, and plans to grow its fleet from six to 10 planes by the fourth quarter.

It’s also preparing to expand internationally with its new wide-body planes, and is focusing on attracting more premium travellers to WestJet.

The threat of a strike last spring by its pilots saw bookings fall sharply due to the potential for travel disruption. WestJet lost money in the second quarter, ending a streak of 52 consecutive quarters of profitability.

(In the October-to-December period, the company reported net earnings of $29.2 million, down from $47.8 million a year earlier.)

Negotiations with the pilots went to arbitration, while the company is preparing to talk with other employee groups that have unionized, including its flight attendants.

“We remain very aware that we’re in the early stages of our turnaround efforts and we have a lot of heavy lifting still ahead of us,” Sims said.

“Nonetheless, we remain confident in the underlying strength of the fundamentals of our business model,” Sims continued.

Analyst Cameron Doerksen of National Bank said the company’s fourth-quarter results were ahead of forecast and travel demand appears solid, with bookings for WestJet’s Dreamliner routes tracking at or ahead of target.

However, the company faces ongoing labour uncertainty, competitive pressures from the potential startup of new ultralow-cost carriers, and needs to execute on major growth initiatives.

“As far as getting the company back on track to higher profitability year over year, I think we are almost certainly going to see that in 2019,” Doerksen said.

“So I’d say the turnaround, if you want to call it that, is well underway.”

And if Alberta’s air travel business remains resilient throughout 2019, the journey ahead should be that much smoother for WestJet.

Chris Varcoe is a Calgary Herald columnist. cvarcoe@postmedia.com

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12 hours ago, Malcolm said:

WestJet rises above Alberta’s economic turbulence

RASM down

Yield down

Net profit dropped like a rock

and the journalist writes a headline like that?

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Yes, but more important is the quick recovery from last quarter's losses and unrest. This will allow WestJet to unfold its plans to expand Swoop, grow B787 fleet, complete the J.V with possibly small jets for its thinner routes, all of which will mean stronger tailwinds for WestJet for the next few years and its stock has rightfully been upgraded.

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