In its most recent quarter, Transat is reporting revenues of just $7.6 million, a decrease of $563.7 million (98.7 per cent) compared with 2020. The carrier had suspended operations since 29JAN 2021 and was not generating revenue, which accounts for the significant drop.
With hopes for a better quarter ahead, the company announced the resumption of operations on 30JUL.
Despite cost reduction measures implemented to deal with the COVID-19 pandemic, Transat’s fixed costs resulted in a fall in revenues more pronounced than the decrease in operating expenses. Transat reported an adjusted operating loss of $51.0 million compared with adjusted operating income of $21.1 million in 2020, a deterioration of $72.1 million.
“Following a quarter without revenues, progress made on vaccinations allows us to plan for a gradual resumption starting 30JUL. We hope that a safe travel recovery plan can be deployed as soon as possible and will lead to a lifting of restrictions in the near future. All indications are that our customers are eager to make use of some of their savings from recent months to travel. We’re excited about welcoming them back soon,” stated Annick Guérard, recently appointed President and Chief Executive Officer, Transat.
As reported by Open Jaw, Transat secured a $700 million loan from the federal government in April, which allows the carrier to restart operations on its own, having ended negotiations for a buyout with various parties.
Transat currently expects to resume service on 30JUL, but cautioned that it cannot predict all the impacts of COVID-19 on its operations. The corporation says that until it’s able to resume operating at a sufficient level, the pandemic will continue to have significant negative impacts on its revenues, cash flows from operations, and operating results.
Calling advances in vaccine rollout in Canada hopeful, Transat still said it does not expect operations to reach pre-pandemic levels before 2023.