UPDATE 3-Air Canada results hurt by fuel costs, Aveos

* "Challenging" quarter with higher fuel costs, strikes, Aveos shutdown

* Net loss swells to C$210 mln vs C$C19 mln

* Bookings, hurt by strikes, now improved

* Q1 adjusted loss C$0.64 Vs loss of C$0.45 a yr earlier

By Susan Taylor

TORONTO May 4 (Reuters) - Air Canada's loss ballooned in the first quarter as the country's largest carrier grappled with wildcat strikes, rising fuel costs and charges from the shutdown of its aircraft maintenance contractor.

Air Canada's shares, which have dropped about 60 percent over the past year, edged higher on Friday after the company posted the results. Air Canada, last profitable four years ago, had provided estimates for some of the quarterly metrics last week.

Despite its recent performance, Montreal-based Air Canada sounded an optimistic note, saying it expected a sharp reduction in maintenance costs and efficiency gains from upcoming labor negotiations with its two biggest unions.

Still, with the airline still facing a swelling pension deficit, fractious labor relations and tougher competition, it conceded that a return to profit won't happen overnight.