March 24, 2010 / 2:40 PM / 8 years ago

Air Canada says will not stop at C$500 mln in cuts

* Has so far cut C$223 million toward 2010 target

* CFO says does not need any new financing right now

TORONTO, March 24 (Reuters) - Air Canada ACa.TO plans to go well beyond the C$500 million ($490 million) in cost cuts and new revenue-generating activities it set for itself as a goal by the end of 2011, the company’s chief financial officer said on Wednesday.

Canada’s biggest airline has so far cut costs or generated new revenues totaling C$223 million in 2010, Michael Rousseau said at the National Bank Financial Transportation and Logistics Conference.

Its target for the year is C$270 million.

Including 2009 savings, Rousseau said the company had achieved C$256 million of the full C$500 million goal.

“We will not stop there,” he said. “We are not going to be satisfied hitting C$500 million. We know of some things within our control and there is an incredible effort within the entire company to drive out costs.”

Last month, Air Canada reported fourth-quarter results that topped analysts’ expectations as it beat its cost-cutting target for the period.

Air Canada’s operating costs are about 30 percent higher than those of its main domestic competitor, WestJet Airlines Ltd (WJA.TO).

Rousseau said Air Canada has no plans to shrink itself to help improve cash flows.

“We like our root structure, we know the economy is coming back and we are comfortable with where we are at this point in time,” he said in response to a question from an analyst.

From a balance sheet perspective, he said the company is in sound shape.

“We still have financing opportunities,” he said, adding that “at this point in time, we don’t think we need that money. It’s relatively expensive money as well.”

$1=$1.02 Canadian Reporting by John McCrank; editing by Rob Wilson

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