WestJet expects higher first quarter 2017 revenue
By Allison Lampert
(Reuters) - WestJet Airlines Ltd (WJA.TO: Quote) expects to generate higher revenue at the start of 2017 by flying more passengers while its chief executive said that a recently-announced U.S. travel ban might present a growth opportunity.
Canada's second-largest carrier warned that increasing fuel costs are an anticipated headwind after the Calgary-based company reported a higher-than-expected fourth quarter profit by flying more passengers and cost controls.
WestJet Chief Executive Gregg Saretsky told analysts that the carrier has not seen higher traffic related to the recently announced U.S. travel ban on visitors from seven countries, though he said it could present an opportunity.
"As border issues and political issues continue to intensify I think there is perhaps an opportunity for Canada to benefit from increasing foreign tourist arrivals," he said. "We are watching with interest what's going on with the change in political landscape."
WestJet expects a rise in revenue per available seat mile (RASM) to grow between 1 and 3 percent during the first three months of 2017, as the Alberta economy improves.
"For the first quarter of 2017 we expect strong traffic and revenue growth to continue," Saretsky told analysts.
Load factor, which measures how effectively the airline filled seats, rose to 80.2 percent in the fourth quarter, from 78.4 percent a year earlier.
The rising costs of jet fuel remains a headwind in 2017, with WestJet expecting a price increase in the first quarter of approximately 36 percent to 40 percent. Continued...