Presentation on theme: "Air Canada Premier Airline in Canada Air Canada Maintains and Strengthens Position in all Markets AC Other AC Other 2001 results based on start of the."— Presentation transcript:
Air Canada Maintains and Strengthens Position in all Markets AC Other AC Other 2001 results based on start of the year. Estimated market share. 2002 results based on OAG Q1 2002 scheduled airline capacity share, published December, 2001 73% 14% 78% 16% 40% 10% 55% 12% 38% 11% 47% 15% 42% 13% 49% 25%
Q401: Encouraging Performance Despite Loss 2001 2000 (millions) Q4Q4 Change Oper. Revenue$2,117$2,590$(473) Oper. Expense2,4252,985(560) Oper. Income (Loss)(308)(395)87 Non-oper. Expense(82)(84)2 Income (Loss) Before Tax$(390)$(479)$89
* Pre-government assistance - US Industry = 6 majors % Operating Margin Best Operating Results* of any Major International Carrier in North America Q1Q2Q3Q4 AC US 0 -5 -10 -15 -20 -25 -30
Air Canadas 4 th Quarter RASM Outperforms Industry * Source ATA 2001/2000 % Change Q1Q2Q3Q4 AC US 5 0 -5 -10 -15 -20 -25
Unit Cost* Performance Outpaces Industry Throughout 2001 * adjusted for one-timers – US industry = 6 majors Q1Q2Q3Q4 AC US 10 8 6 4 2 0 -2 -4 2001/2000 % Change
More Air Canada Strengths Proven track record of superior service Top Brand recognition throughout Canada Labor contract stability Labor rates lower than U.S. carriers
Future Labor Cost Much Lower Than U.S. Carriers 200220032004 Maintenance and Ramp2.5% 2.5% 2.5% Flight Attendants--- Pilots 2.5% 2.5%- Customer Sales & Service 2.5% 2.5%- Air Canada
Favorable Competitive Landscape ServiceCompetitor Reductions Trans AtlanticCancellations: Virgin Toronto-London Sabena Montreal-Brussels Trans PacificReductions: Numerous carriers reduced service via U.S. EVATaiwan-Canada
Favorable Competitive Landscape ServiceCompetitor Reductions DomesticCanada 3000 ceases operations Nov/09 Transborder Cancellations: USA AA Boston-Halifax/Montreal/Ottawa UA Toronto-Denver USAir Toronto-Indianapolis Canada 3000Toronto-Newark, Los Angeles- Vancouver/Edmonton/Calgary/ Toronto Reductions: Chicago, LaGuardia, Denver, San Francisco, Seattle, Portland, Los Angeles, Houston, Cleveland, Indianapolis, Baltimore
Air Canadas Action Plan Launch new products Reduce capacity Renew fleet Lower unit costs Lower manpower levels
Low Cap Ex in 2002 ($ millions) Aircraft$602 Financing(658) Net$(56) Other203 Total Mainline$147 Subs15 Total$162
Significant Value in Air Canadas Business Units
Investment Considerations Commanding share of all markets served Solid hub and network strategy Traffic almost back to normal Pricing recovering Industry capacity rationalized Unit costs coming down Adequate liquidity Low capital expenses going forward Substantial business unit value
Caution Concerning Forward-looking Information: Certain statements made in this presentation may be of a forward-looking nature and subject to important risks and uncertainties. The results indicated in these statements could differ materially from actual results for a number of reasons, including without limitation, general industry, market and economic conditions, the ability to reduce operating costs and fully integrate the operations of Canadian Airlines, employment relations, energy prices, currency exchange rates, interest rates, changes in laws, adverse regulatory developments or proceedings and pending litigation. Any forward-looking statements contained in this presentation represent Air Canadas expectations as of February 11, 2002 and are subject to change after such date. However, Air Canada disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
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