EXCEEDING EXPECTATIONS

For the first quarter of 2013, WestJet has reported record net earnings of $91.1 million, or $0.68 per diluted share, up from the net earnings of $68.3 million, or $0.49 per diluted share reported in the first quarter of 2012. These results mark WestJet’s 32nd consecutive quarter of profitability. Based on the trailing twelve months, the airline achieved a return on invested capital of 14.3%, up from the 13.7% reported in the previous quarter. WestJet president and CEO, Gregg Saretsky said: “We are very pleased to report our best ever quarterly earnings and for the third consecutive quarter we exceeded our 12% ROIC target by achieving 14.3%. “The excitement is building as we move closer to the launch of WestJet Encore. I want to thank WestJetters for their dedication and tremendous efforts in providing our guests a caring and friendly experience each and every day.” In February, WestJet announced the first two new communities that WestJet Encore will be servicing. Beginning on June 24, 2013, WestJet Encore will begin daily service from Calgary and Vancouver to Fort St. John, British Columbia, and from Calgary to Nanaimo, British Columbia. In January 2013, WestJet launched a three-year company-wide business transformation initiative with a goal to reduce annual costs by $100 million by the end of 2015 and to undertake a longer term initiative to ensure WestJet’s unit costs are competitive with low cost North American airlines. This initiative will focus on aircraft and asset utilization, distribution, productivity, and all non-operational expenses. WestJet has also announced that it has entered into an agreement with a third party under which WestJet will sell 10 of its oldest Boeing Next-Generation 737-700 aircraft to that party in 2014 and 2015, and concurrently entered an agreement with Boeing to purchase 10 Boeing Next-Generation 737-800 aircraft in 2014 and 2015, effectively reducing the average age of WestJet’s fleet by approximately one year. WestJet has deferred the delivery of five Boeing Next-Generation 737-700 aircraft from 2014 and 2015 to 2016 and 2017. “These agreements are part of our strategy to optimize and modernize our fleet mix, which will improve CASM, while maintaining fleet flexibility going forward,” Saretsky said. APRIL RESULTS The carrier also reported its traffic results for April 2013, posting a load factor of 82.7%. The carrier’s revenue passenger miles (RPMs) rose by 3.2%, while its available seat miles (ASMs) were up by 7.4% over the same period in 2012. The airline flew 1.5 million guests in April, a year-over-year increase of 2.2%t or approximately 33,000 additional guests. WestJet president and CEO Gregg Saretsky commented: “We are pleased with the continued year-over-year growth in traffic, and have experienced the same soft patch reported by other North American carriers in April, which is not only attributable to the timing of the Easter and Passover holidays, but also the cancellation of some of the Thomas Cook capacity purchase commitments we were unable to resell so late in the season, and the loss of the one-time benefit from Air Canada’s labour uncertainty in the second quarter of 2012. We are however seeing stronger bookings in May and June.” EXEMPTION WestJet has also confirmed that it has received an exemption from Transport Canada to the requirement for one flight attendant for every 40 passengers on board. The exemption, which is effective immediately, allows for one flight attendant for every 50 seats on board the aircraft. Saretsky said: “We are pleased that Transport Canada has granted this exemption. One flight attendant for every 50 seats is the accepted international practice and has been in place for decades around the world. This exemption will place us on a level regulatory playing field with U.S. and international carriers who fly in and out of Canada every day under these rules. Safety is a core value at WestJet and we commend the government for recognizing that there is a consistent level of safety operating under this ratio.” Antonio Faiola, WestJet flight attendant and chair of PACT, WestJet’s employee association, said: “WestJet has committed that it will not lay off any flight attendants under this new exemption,” commented. “Our history speaks for itself: WestJet has always worked with its employees when our business changes and this is another example of its commitment to its people.” And Saretsky noted: “We anticipate cost savings once this exemption has been operationalized across our network. These savings will allow us to grow our network and continue to provide low fares for the Canadian traveller. We will now work with our operations teams to determine when we can implement these changes which will in turn determine when these savings will be realized.” Go to http://www.westjet.com for more.