Transat AT, parent of Canadian carrier Air Transat, squeezed out a profit and generated C$765 million ($570 million) in revenue during its fiscal fourth quarter which ended on 31 October, as the carrier distances itself from the lows of the Covid-19 pandemic.
That total compares with revenue of C$574 million during the same three months ending 31 October last year. On the period, the carrier posted a C$3 million profit, versus losing C$126 million during its fiscal fourth quarter of 2022.
Montreal-based Transat “solidified its position in the Canadian leisure travel industry” during the period, chief executive Annick Guerard said during the company’s earnings call. “These solid results represent a major turnaround compared to fiscal 2022, which was still impacted by the persisting effects of the Covid pandemic.”
The carrier generated C$3 billion of revenue for the full fiscal year of 2023, compared with C$1.6 billion last year.
Looking ahead to 2024, the carrier plans to increase capacity by 19% through “recent and planned aircraft additions, as well as further improvements in fleet utilisation” and stepping up flight frequencies on popular routes.
Transat intends to boost its best-performing routes from both Toronto and Montreal and has extended several popular seasonal flights to year-round.
“In this regard, we have announced year-round service to Lyon, Marseilles, Costa Rica and El Salvador from Montreal, which further reinforces Air Transat’s leading position in the Canadian market for travel to Europe and Latin America,” Guerard says.
The carrier is also launching routes to Lima, Peru and Marrakesh, Morocco next summer. ”South America and North Africa both represent high-potential markets for Transat,” she adds.
Transat plans to fly 44 aircraft during Canada’s 2024 winter air travel season.
The carrier will also move forward with a new chief financial officer starting 9 January, as it recently named Jean-Francois Pruneau as the replacement for Patrick Bui, who is taking the same role for Canadian discount store chain Dollarama.
In a plan to be implemented gradually next year, Transat will seek to expand its network through a new joint venture with Toronto-based Porter Airlines, building on an existing codeshare partnership. The two carriers will intertwine their operations by sharing flight schedules and routes, hoping their combined forces can challenge Air Canada and WestJet’s market dominance.
“Transat will continue to focus on executing its strategic plan,” Guerard says. “A key objective of this plan is to grow customer traffic through alliances, and our recently announced joint venture with Porter Airlines represents a major step forward in this regard.”
With Porter’s growing transcontinental network feeding into Transat’s long-haul flights, both carriers hope to expand at a greater pace than they could have otherwise.
“This feeder network strategy is designed to accelerate expansion in our respective key markets, which for Transat consists of international medium- and long-haul flights,” Guerard says. “At full potential, we expect Porter’s connecting flights to account for 15%-18% of Transat’s passenger traffic, based on both airlines’ current growth plans.”
Though the company is wary of the “uncertain economic environment” that has affected US leisure carriers, Guerard says Transat is well-positioned heading into 2024. ”Customer demand for international leisure travel from Canada remains favourable.”