By Ketki Saxena
Investing.com -- Air Canada (TSX:AC)has achieved a break-even point in the first quarter, capitalizing on the growing demand for travel and reduced fuel expenses as it approaches a complete rebound from the pandemic's impact.
The leading Canadian airline reported an operating revenue of C$4.9 billion ($3.6 billion), almost twice that of last year's first quarter when some Covid restrictions were still in effect within the country. This figure surpassed analysts' predictions of C$4.5 billion.
Since being affected by Covid three years ago, this marks Air Canada's second-highest quarterly revenue – only outdone by the peak summer travel season last year. The airline anticipates increasing its capacity by 23% throughout this year, bringing their flight schedule close to 90% of what it was back in 2019.
Mirroring some US airlines' success stories, Air Canada is experiencing consistent high demand from passengers. In recent news, both American Airlines (NASDAQ:AAL) Group Inc. and United Airlines (NASDAQ:UAL) Holdings Inc. announced that their second-quarter profits might surpass Wall Street forecasts due to strong bookings for international flights.
"Our first quarter financial results exceeded both internal and external expectations and we expect demand to persist, supported by strong advance bookings for the remainder of the year," said Michael Rousseau, CEO at Air Canada.
Airplanes operated by Air Canada are filling up quickly; during this past quarter they recorded an almost 85% load factor, which is a metric that measures the percentage of available seats occupied by passengers. This figure is considerably higher than last year's 66%, and even surpasses pre-pandemic levels.
In terms of financials, Air Canada reported earnings of C$4 million while incurring a minor operating loss amounting to C$17 million. The airline's share price has increased by 8% this year but has trailed behind its US counterparts since early 2020 due to Canada maintaining Covid restrictions for longer periods compared to the United States.