Air Canada Reports Fourth Quarter Loss of $60 Million

Air Canada reported a net loss of $60 million in the fourth quarter of 2011, which included foreign exchange gains of $114 million, compared to net income of $89 million in the fourth quarter of 2010, which included foreign exchange gains of $136 million. For the full year, Air Canada reported a net loss of $249 million in 2011, which included foreign exchange losses of $54 million, compared to a net loss of $24 million in 2010, which included foreign exchange gains of $184 million. Operating expenses grew by 8 percent, mainly due to higher fuel prices.

System passenger revenues increased $118 million or 5.2 percent in the fourth quarter of 2011 from the fourth quarter of 2010 on a 2.6 percent growth in traffic and a 1.9 percent improvement in yield. “Despite the challenges of 2011, I am pleased to report solid progress advancing the corporation's stated priorities during the year," said Calin Rovinescu, president and chief executive officer. "Our focus on revenue generation initiatives resulted in 8 percent growth or an increase of $826 million from the previous year and a record revenue performance for the airline, which helped mitigate a fuel expense increase of $723 million.”

But Air Canada faces continuing labor problems. It is continuing negotiations with its pilots and the union is asking members for a strike mandate. Pilots oppose a proposal to create a low-cost unit. The airline has suffered nine losses in the past 12 quarters and ongoing labor problems.