Air Canada Reports 2020 Annual Results
Air Canada released its 2020 annual results, reporting total revenues of $5.833 billion in 2020 which is a decline of $13.298 billion or 70% from 2019.
The carrier reported 2020 negative EBITDA(1) (excluding special items) or (earnings before interest, taxes, depreciation and amortization) of $2.043 billion compared to 2019 EBITDA of $3.636 billion.
It also reported an operating loss of $3.776 billion in 2020 compared to operating income of $1.650 billion in 2019. Unrestricted liquidity amounted to $8.013 billion at December 31, 2020.
Calin Rovinescu, president and Chief Executive Officer of Air Canada, said that: “With today’s release of 2020 fourth quarter and full year results, we close the book on the bleakest year in the history of commercial aviation, after having reported several years of record results and record growth at Air Canada.”
Rovinescu observed: “The catastrophic impact of COVID-19 and government-imposed travel restrictions and quarantines has been felt across our entire network, deeply affecting all of our stakeholders. It has resulted in a 73% decline in passengers carried at Air Canada during the year and an operating loss of nearly $3.8 billion.”
He continued: “Yet, despite a year-long onslaught of bad news, uncertainty and challenges posed by constantly changing requirements, our employees valiantly served our remaining customers professionally and transported them safely to their destinations, operated hundreds of repatriation flights and our Cargo team transported essential Personal Protective Equipment to Canada and around the world. I commend them for their courage as well as for their tireless efforts in these exceptionally trying circumstances to position our company well for when we emerge from the pandemic.”
Air Canada’s boss said that: “As we move into 2021, while uncertainty remains as a result of the new variants of the virus and changing travel restrictions, the promise of new testing capabilities and vaccines is encouraging and presents some light at the end of the tunnel. As our success raising significant liquidity throughout 2020 indicates, investors and financial markets share our optimistic long-term outlook for our airline.”
Rovinescu continued: “I am also very encouraged by the constructive nature of discussions that we have had with the Government of Canada on sector-specific financial support over the last several weeks. While there is no assurance at this stage that we will arrive at a definitive agreement on sector support, I am more optimistic on this front for the first time.”
He said that; “Given these circumstances, we have made many painful decisions over the past year. These include reducing staff by more than 20,000, dismantling a global network ten years in the making, suspending service to many communities and aggressively cutting fixed costs. At the same time, we have bolstered our liquidity position through several debt and equity financings to allow for additional operational flexibility and to support the implementation of our COVID-19 Mitigation and Recovery Plan. We rationalized our fleet, accelerating the permanent removal of older, less efficient aircraft, and restructured new aircraft orders so that we will have a more fuel-efficient and greener fleet that is right-sized for the post-COVID-19 recovery period. In addition, we completed essential customer-oriented initiatives, such as rolling out our new reservation system and delivering on a much-improved Aeroplan loyalty program that will be amongst the industry leaders. Our Cargo team delivered stellar results in 2020 and showed that we can build a strong, dedicated cargo fleet going forward.”
Rovinescu said that: “As we announced last Fall, I will be retiring as President and Chief Executive Officer effective Feb. 15 and Michael Rousseau, our Deputy Chief Executive and Chief Financial Officer, who has worked very closely with me for the last 12 years, will assume the role. I have absolute confidence in Mike and the entire leadership team – and know that as a result of our strong culture and discipline, Air Canada has the strength, agility, and resources to overcome the current crisis and to keep adapting to remain a global leader in the post-pandemic world. I am extremely grateful to our customers for their trust and confidence, our employees and partners for their unwavering dedication and loyalty to our airline, and to our Board of Directors for their full support throughout my tenure.”