(Reuters) - CAE Inc CAE.TO said on Wednesday it is in advanced discussions with airlines about doing more training of their pilots after the company reported a bigger than expected quarterly loss due to COVID-19.
The world’s largest civil aviation training company is cutting costs and counting on the easing of travel restrictions to bolster demand for pilot-training services.
Revenues from civil training, CAE’s largest business unit,
dropped due to travel restrictions and lower customer demand during the quarter ended June 30, with a center utilization rate averaging 33% compared with 76% during the same three months a year earlier.
Chief Executive Marc Parent told analysts he sees opportunities to win outsourced training business from airlines, which are struggling to conserve cash.
“We’re currently in advanced discussions with a number of airline customers to potentially do more for them,” he said.
Montreal-based CAE said deliveries of flight simulators declined on an annual basis from five to two units during the quarter. CAE would make most of its anticipated 35-40 simulator deliveries during the back half of its fiscal year.
CAE expects to cut about C$100 million in costs over the next 12 months to yield C$50 million in annual savings.
The company swung to a net quarterly loss of C$110.6 million ($83.36 million), or 42 Canadian cents per share, compared with a profit of C$61.5 million a year earlier.
On an adjusted basis, CAE lost 11 Canadian cents per share in the quarter, while its revenue declined 33.3% to C$550.5 million, compared with analysts estimates of a quarterly loss of 6 Canadian cents per share, according to IBES estimates from Refinitiv.
CAE stock was down 1.64% in afternoon trade.
Reporting By Allison Lampert in Montreal and Ankit Ajmera and Sanjana Shivdas in Bengaluru; Editing by Krishna Chandra Eluri, Nick Zieminski and Cynthia Osterman
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