Transat A.T. Inc., has released their third quarter financial results, posting revenues of $819.4 million for the quarter ended July 31, 2009, compared with $859.9 million for the corresponding period of 2008 - a decrease of $40.5 million or 4.7%. The diversified travel corporation , recorded a margin of $27.2 million, up from $14.6 million in 2008, or 86%, and net income of $31.0 million, compared with a net loss of $0.9 million in 2008.
"These results, posted during a quarter marked by an economy in recession, a flu outbreak and continuing abundant supply, are satisfactory under the circumstances. Prudence and rigour remain the watchwords, but the tourism market is proving to be relatively resilient," stated Jean-Marc Eustache, President and Chief Executive Officer of Transat A.T. Inc.
Transat posted revenues of $2,825.7 million for the first nine months of fiscal 2009, compared with $2,722.4 million for the corresponding period in 2008, an increase of $103.3 million. The margin decreased to $57.8 million in 2009 from $104.6 million in 2008. Net income stood at $43.7 million, or $1.32 per share fully diluted, versus $33.0 million in 2008.
As at July 31, 2009, the Corporation's cash and cash equivalents totalled $215.2 million, compared with $259.6 million as at July 31, 2008 and $145.8 million as at October 31, 2008.
Revenues of North American subsidiaries, which stem from sales made in Canada and abroad, were down $31.4 million (6.2%) during the third quarter, compared with the same period in 2008. The decrease was attributable to a drop in average selling prices and to a 6.5% decrease in the volume of travellers, the latter largely attributable to a decline of sales in Europe for Canadian destinations. Transat's North American subsidiaries reported a margin of 1.1%, compared with an operating loss of 2.0% in 2008.
Revenues of European subsidiaries, which stem from sales made in Europe and in Canada, decreased by $9.1 million (2.6%) during the third quarter, compared with the corresponding period of 2008, despite a 4.7% increase in traveller volume. The increase in volume came from Canadian Affair, which sells in the United Kingdom and in Canada, partially offset by lower volumes in France, especially in the long-haul market segment. The Corporation's European subsidiaries reported a margin of $22.0 million, or 6.5%, for the quarter, compared with $25.0 million (7.1%) in 2008. The unfavourable variance in margin is due in part to fuel-hedging operations.
Canada-Europe travel, which represents an important part of Transat's business, are showing higher volume of reservations from Canada to Europe than the 2008 levels whereas reservations from Europe are trailing. While prices are lower, Transat expects they will be partially offset by lower fuel costs and potentially by higher load factors.
Reservations and the passenger load factor for travel to sun destinations from Canada are similar to 2008. Lower prices could be offset by lower fuel costs and the positive impact of lower airline seat costs.
