Chorus Aviation shares slump after results, dispute hearing delay

Fri Feb 22, 2013 3:23pm EST
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TORONTO Feb 22 (Reuters) - Shares of Air Canada's contract carrier Chorus Aviation Inc fell as much as 9 percent on Friday, extending Thursday's losses, after the company reported lower fourth- quarter results and warned about its ongoing dispute with Air Canada.

Chorus, which operates about 130 planes for Air Canada under the Jazz logo, said that a resolution to a cost dispute with Air Canada has been further delayed, with the next hearing scheduled for April.

"Although there can be no assurances as to the outcome, we remain confident in our position and continue to work to reach a successful conclusion of the remaining issues in dispute," said Chorus Chief Executive Joe Randell during a conference call with analysts on Thursday.

The more heavily-traded class B shares, which have lost more than 12 percent in the last two days, were down 5.2 percent, at C$3.98 mid-afternoon, after falling as low as C$3.80.

Chorus has given back most of its 2013 gains since last week, when its largest shareholder, Fairfax Financial Holdings Ltd, sold all of its stake in the company.

The company reported fourth quarter net income of C$14.7 million, or C$0.12 a share after markets closed on Wednesday. This was a 35.3 percent drop from C$22.7 million, or C$0.18 a share, for the same period a year ago.

The company maintained its quarterly dividend of C$0.15 per share and said it planned to purchase up to 11.1 million Class A variable voting shares and/or Class B voting shares, representing 10 percent of the public float. (Reporting by Solarina Ho; Editing by Nick Zieminski)