- Accelerated commercial growth strategy grounded on strong foundation built over the last decade and leveraging many opportunities ahead
- Focus on margin expansion, consistent cash generation to invest in the business and create long-term value for shareholders
- Capital allocation objectives with disciplined balance sheet management and responsible risk profile
- Air Canada reaffirms full year 2024 guidance and shares expectations for certain financial measures for the full year
- 2025 full year guidance, financial targets for 2028, and long-term aspiration shared
MONTREAL, Dec. 17, 2024 /CNW/ – In conjunction with its 2024 Investor Day being held today at 8:30 a.m. ET., Air Canada today reaffirmed its 2024 full year guidance with certain full-year expectations, announced its 2025 full year guidance, its 2028 key financial targets and 2030 aspirations. The event will be webcast live, and a replay of the investor day along with the presentation materials will be available shortly after the event, at aircanada.com/investors.
“We are proud and excited to share Air Canada’s ambitions. We are announcing a long-term plan grounded on a proven commercial strategy. The story of Air Canada’s performance is one of demonstrated ability to execute and deliver on commitments. Our strategy, which builds on and leverages the unique strengths developed over the last decade, is to rise even higher with consistent margin expansion and structural cash generation while maintaining a strong balance sheet and a responsible risk profile. Our plan includes expanding the network, improving the customer experience, taking care of our employees, enhancing financial performance and continuously investing in the business to generate long-term value for investors, while being mindful of the interests of our stakeholders. We believe we are very well positioned to execute our long-term plans,” said Michael Rousseau, President and Chief Executive Officer of Air Canada.
At the 2024 Investor Day, Mr. Rousseau and members of the executive team will provide details on Air Canada’s strategy, investment thesis and financial targets.
Outlook
Air Canada is reiterating the full year 2024 guidance provided in Air Canada’s news release dated November 1, 2024, and is providing guidance for the full year 2025.
| Metric (Dollar amounts are in Canadian dollars) | 2023 Results | 2024 Guidance | 2025 Guidance |
| ASM capacity | 99.012 billion | Approximately 5% increase versus 2023 | Between 3% and 5% increase versus 2024 |
| Adjusted CASM* | 13.49 ¢ | Approximately 2% increase versus 2023 | Between 14.25 ¢ and 14.50 ¢ |
| Operating expenses | $19.554 billion | Not guided | Not guided |
| Adjusted EBITDA* | $3.982 billion | Approximately $3.5 billion | Between $3.4 and $3.8 billion |
| Operating income | $2.279 billion | Not guided | Not guided |
| Free cash flow* | $2.756 billion | Not guided | Breakeven +/- $200 million |
| Net cash flows from operating activities | $4.320 billion | Not guided | Not guided |
Major Assumptions
Air Canada made assumptions in providing its 2024 and 2025 guidance—including moderate Canadian GDP growth for 2024 and 2025. Air Canada also assumes that the Canadian dollar will trade on average, at C$1.36 and C$1.40 for the full year 2024 and 2025, respectively, and that the price of jet fuel will average C$1.00 and C$0.95 per litre for the full year 2024 and 2025, respectively.
In addition, Air Canada shared its expectations for certain financial measures for the full year 2024, its long-term 2028 financial targets and 2030 aspirations which are described below, and which will be discussed during its Investor Day presentations.
| Metric | 2023 Results1 | 2024 Expectations | 2028 Targets | 2030 Aspirations |
| Operating revenues | $21.833 billion | Approximately $22 billion | Approximately $30 billion | Exceed $30 billion |
| Adjusted EBITDA margin* | 18 % | Approximately 16% | Greater than or equal to 17% | Between 18% and 20% |
| Operating margin | 10 % | Not provided | Not provided | Not provided |
| Net cash flows from operating activities as a percentage of adjusted EBITDA* | 108 % | Greater than 90% | Approximately 90% | Approximately 90% |
| Additions to property, equipment and intangible assets as a percentage of operating revenues* | 7 % | Approximately 12% | Lower than or equal to 12% | Lower than 12% |
| Free cash flow margin* | 13 % | Between 4% and 5% | Approximately 5% | Approximately 5% |
| Return on invested capital* | 18 % | Not provided | Not provided | Greater than or equal to 12% |
| Fully diluted share count | Approximately 376 million shares | Not provided | Lower than 300 million shares | Lower than 300 million shares |
1Percentage amounts in the table above may not calculate exactly due to rounding.
The 2028 long-term targets and 2030 aspirations provided in this news release do not constitute guidance or outlook, but rather are provided for the purpose of assisting the reader in measuring progress toward Air Canada’s objectives. The reader is cautioned that using this information for other purposes may be inappropriate. Air Canada may review and revise these targets and aspirations including as economic, geopolitical, market and regulatory environments change. These targets and aspirations are used as goals as Air Canada executes on its strategic priorities, and they assume a normal business environment. Air Canada’s ability to achieve these targets and aspirations is also dependent on its success in achieving initiatives and business objectives that are described in the 2024 Investor Day presentations which will be available shortly after the event at aircanada.com/investors, including, but not limited to, those relating to increasing revenues, growing fleet and network capacity, and successfully executing on other key investments and initiatives, as well as other major assumptions, including those described in this news release, and are subject to a number of risks and uncertainties.
About Air Canada
Air Canada is Canada’s largest airline, the country’s flag carrier and a founding member of Star Alliance, the world’s most comprehensive air transportation network. Air Canada provides scheduled service directly to more than 180 airports in Canada, the United States and Internationally on six continents. It holds a Four-Star ranking from Skytrax. Air Canada’s Aeroplan program is Canada’s premier travel loyalty program, where members can earn or redeem points on the world’s largest airline partner network of 45 airlines, plus through an extensive range of merchandise, hotel and car rental partners. Through Air Canada Vacations, it offers more travel choices than any other Canadian tour operator to hundreds of destinations worldwide, with a wide selection of hotels, flights, cruises, day tours, and car rentals. Its freight division, Air Canada Cargo, provides air freight lift and connectivity to hundreds of destinations across six continents using Air Canada’s passenger and freighter aircraft. Air Canada’s climate ambition includes a long-term aspirational goal of net-zero greenhouse gas emissions by 2050. For additional information, please see Air Canada’s TCFD disclosure.