Transat swings to profit on cost cuts
(Reuters) - Canadian travel operator Transat AT Inc TRZb.TO swung to a profit in the third quarter as its cost-cutting measures bore fruit, and said it expects margins to continue to improve.
The company, which competes with WestJet Airlines' (WJA.TO: Quote) WestJet Vacations and Air Canada's ACb.TO Air Canada Vacations, expects fourth-quarter margins to be also above last year's levels.
Transat said prices and load factors, or the percentage of available seats filled with paying customers, were higher in the current quarter than a year ago for its transatlantic market.
For the third-quarter, net income attributable to shareholders was C$9.4 million, or 25 Canadian cents per share, compared with a loss of C$2.8 million, or 7 Canadian cents per share, a year earlier.
Transat, which also operates in Europe and the Mediterranean basin, reported an adjusted after-tax income of 28 Canadian cents a share.
Revenue fell 3 percent to C$909.1 million as a result of its planned capacity reduction, Transat said.
The company said in July that maintenance employees have approved a labor contract that defers planned wage increases temporarily.
Transat's class B shares, which have fallen 42 percent this year, closed at C$3.99 on Wednesday on the Toronto Stock Exchange.
(Reporting by Ankur Banerjee in Bangalore; Editing by Sreejiraj Eluvangal)
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