CANADIAN AIRLINES' pilots have ratified a new three-year labour agreement which will save the carrier around C$41 million ($30 million) a year.

Under the deal, the carrier's 1,200 pilots have accepted a 5% cut in pay in exchange for shares in the airline.

The deal was struck as Canadian Airlines revealed a record net profit for the third quarter. The result follows a poor, performance in the March quarter when the carrier had visibly failed to add extra traffic to fill new aircraft capacity.

President Kevin Jenkins warns that the group will still report a "significant loss" for the whole of 1995, although he promises profits in 1996.

Rival Air Canada followed with another strong set of results, although the net result was boosted by a gain of C$58 million ($42 million) from the sale of share options back to its US partner Continental Airlines. Air Canada says that it still owns 18.5% of Continental shares and 23.8% of the votes.

The third quarter also brought a modest improvement for Air Canada on yields, helping to offset a rise in the costs of its expanded capacity. President Hollis Harris adds that, so far in 1995, the carrier has added ten new routes and 12 jet airliners.

The operating improvement largely came from international passenger traffic, which rose by 15%. Yields were up by 8%.

Source: Flight International