Air Canada Reports Third Quarter 2022 Financial Results

  • Operating margin of 12.1 per cent, first positive quarterly operating margin since the pandemic began
  • Operating revenues of $5.322 billion, more than double the third quarter of 2021
  • Net loss of $508 million compared to a net loss of $640 million in the third quarter of 2021
  • EBITDA margin* of 19.9 per cent for the third quarter of 2022
  • Total liquidity of over $10.2 billion at September 30, 2022

MONTREAL, Oct. 28, 2022 /CNW Telbec/ – Air Canada today reported its third quarter 2022 financial results.

“Air Canada’s solid third quarter results stem from the ongoing restoration of our extensive network, an improved operational performance, our modern and efficient fleet, as well as leading products and services, and an incredible team of employees,” said Michael Rousseau, President and Chief Executive Officer of Air Canada.

“We generated $644 million in operating income with a strong operating margin of 12.1 per cent. This was the first quarter since the pandemic began in which we delivered positive operating income. In addition, we achieved significant improvements in other metrics from a year ago. Operating revenues more than doubled to $5.3 billion, on a capacity growth of 130 per cent, and EBITDA* increased to over a billion, with a margin of 19.9 per cent. Yields also improved, helping offset higher fuel prices. Air Canada Cargo is consistently contributing to our results and Aeroplan is continuing to perform extremely well with travel’s return. Our transformed loyalty program’s gross billings from points sold, purchase volume on co-brand cards, and new members are all at record highs. 

“Despite the global disruption of air travel, through teamwork and focused efforts, we safely transported nearly 11.5 million customers to their destinations this quarter. We are further encouraged by continuing strong demand, now further stimulated by the easing of COVID-related restrictions. Advance ticket sales in the quarter were at 95 per cent of third quarter 2019 levels. In the third quarter, our adjusted unit cost or adjusted CASM* improved by 38 per cent to 11.6 cents compared to the same period last year, and we will continue to carefully control costs. We ended the quarter with just over $10.2 billion in total liquidity.

“Thanks to the hard work and commitment of our employees, after a difficult June and July, we saw significant operational improvement throughout August and September, with the operation today now on par with pre pandemic levels.  Still, we know many customers experienced disruptions travelling this summer, and we sincerely regret any inconveniences that have occurred. We would like to thank our customers for their understanding and loyalty and assure them that the lessons of this operationally challenging period are now being applied to build greater resiliency going forward, and to elevate the customer experience overall. Air Canada marked its 85th anniversary this quarter. We stand on a robust foundation and, with our most recent financial results, investments and strategic plan, are confident we have a bright future in connecting Canada and the world,” said Mr. Rousseau.

Third Quarter 2022 Financial Results

Air Canada reported the following results for the third quarter of 2022:

  • Operating capacity, measured by Available Seat Miles (ASMs) more than doubled from the third quarter of 2021. Capacity in the third quarter was 79 per cent of the third quarter of 2019, in line with projections in Air Canada’s second quarter 2022 earnings release, dated August 2, 2022.
  • Passenger revenues of $4.818 billion increased about three times from the third quarter of 2021, representing about 94 per cent of passenger revenues in the third quarter of 2019.
  • Operating revenues of $5.322 billion increased about two-and-a-half times from the third quarter of 2021.
  • Operating expenses of $4.678 billion increased $2.211 billion from the third quarter of 2021.
  • Cost per available seat mile (CASM) decreased to 18.3 cents from the third quarter 2021 CASM of 22.2 cents, a sequential decrease from CASM of 20.8 cents in the second quarter of 2022. 
  • Adjusted cost per available seat mile (Adjusted CASM)* of 11.6 cents compared to third quarter 2021 adjusted CASM of 18.7 cents, a sequential decrease from Adjusted CASM of 13.1 cents in the second quarter of 2022. Compared to the third quarter of 2019, Adjusted CASM increased 14.8 per cent.
  • Operating income of $644 million compared to an operating loss of $364 million in the third quarter of 2021, the first quarterly operating income since the pandemic began.
  • EBITDA (excluding special items) or earnings before interest, taxes, depreciation, and amortization of $1.057 billion, better than the negative EBITDA of $67 million in the third quarter of 2021.
  • Net loss of $508 million (or $1.42 per diluted share), compared to a net loss of $640 million (or $1.79 per diluted share) in the third quarter of 2021. Third quarter 2022 net loss included a foreign exchange loss of $951 million.
  • Net cash flows from operations of $290 million compared to net cash flows from operations of $305 million in the third quarter of 2021.


For the fourth quarter of 2022, Air Canada plans to increase its ASM capacity by about 60 per cent from the same quarter in 2021 (or approximately 85 per cent of fourth quarter 2019 ASM capacity). 

Air Canada is now providing the following guidance for the full year 2022:

  • Air Canada expects to have increased its full year 2022 ASM capacity by about 148 per cent from 2021 ASM levels (or about 73 per cent of 2019 ASM levels). Air Canada will continue to adjust capacity and take other measures as required, including to account for passenger demand.
  • For 2022, Air Canada expects Adjusted CASM to be about 16 to 18 per cent above 2019 levels.  The variance to prior guidance is mainly due to an increase in wages, salaries and benefits, costs related to a higher number of passengers carried versus prior expectations (which translates into higher passenger service and distribution costs per ASM), as well as the impact of the weakening of the Canadian dollar. 
  • For 2022, Air Canada maintains its expectation of an annual EBITDA margin* of about 8 to 11 per cent.

Major Assumptions

Full year assumptions were made by Air Canada in preparing and making forward-looking statements. Among these, Air Canada assumes moderate Canadian GDP growth for 2022. Air Canada also assumes that the Canadian dollar will trade, on average, at C$1.30 per U.S. dollar for the full year 2022 and that the price of jet fuel will average C$1.33 per litre for the full year 2022.

Selected Financial Metrics and Statistics

The financial and operating highlights for Air Canada for the periods indicated are as follows:

(Canadian dollars in millions, except per share data or where indicated)Third Quarter
Financial Performance Metrics20222021$ Change
Operating revenues5,3222,1033,219
Operating income (loss)644(364)1,008
Loss before income taxes(504)(679)175
Net loss(508)(640)132
Adjusted pre-tax income (loss)446(649)1,095
Operating margin (%)12.1(17.3)29.4 pp (8)
EBITDA (excluding special items)1,057(67)1,124
EBITDA margin (%)19.9(3.2)23.1 pp
Total liquidity10,23614,504(4,268)
Net cash flows from operating activities290305(15)
Free cash flow(43)156(199)
Net debt7,8297,117712
Diluted loss per share(1.42)(1.79)0.37
Operating Statistics (3)20222021% Change
Revenue passenger miles (“RPMs”) (millions)22,1187,915179.5
Available seat miles (“ASMs”) (millions)25,56211,116130.0
Passenger load factor %86.5 %71.2 %15.3 pp
Passenger revenue per RPM (“Yield”) (cents)21.820.75.4
Passenger revenue per ASM (“PRASM”) (cents)18.814.728.1
Operating revenue per ASM (cents)20.818.910.0
Operating expense per ASM (“CASM”) (cents)18.322.2(17.5)
Adjusted CASM (cents) 11.618.7(38.1)
Average number of full-time-equivalent (“FTE”) employees (thousands) 31.821.349.7
Aircraft in operating fleet at period-end3443372.1
Seats dispatched (thousands)13,9517,09496.7
Aircraft frequencies (thousands)99.657.473.6
Average stage length (miles) 1,8321,56517.1
Fuel cost per litre (cents)131.872.980.7
Fuel litres (thousands)1,227,669648,51589.3
Revenue passengers carried (thousands) 11,4665,067126.3

Air Canada

Air Canada is Canada’s largest airline and the largest provider of scheduled passenger services in the Canadian market, the Canada-U.S. transborder market and in the international market to and from Canada. Air Canada together with its Air Canada Express regional partners…