Flair CEO says airline flying high — enough to stave off 'growing pains,' large loans

Flair Airlines CEO Stephen Jones says his budget carrier is at last running a smooth operation propelled by high passenger numbers, despite "growing pains" at the debt-laden company that's still striving to gain consumer confidence. The CE said Flair topped the list of Canadian airlines in on-time performance over the summer as well as in load factors, with planes 90% full on average last month. “We're very far from perfect,” Jones qualified. “We’ve had tons of growing pains — some operationally, some financially, some CTA." The latter refers to the Canadian Transportation Agency, which prompted Flair last year to rejig its board and revoke shareholder rights from key investor 777 Partners in order to comply with rules around domestic ownership. Moreover, Flair must continue to make payments of more than US$7m per month on its 21 Boeing 737 plane leases and manage loans amounting to between US$200m and US$300m, Jones said. “We do pay expensive debt," he said, citing rates of 18% on loans from 777 Partners, the Miami-based company that owns one-quarter of the airline. “No one else was standing there willing, during COVID and during high oil prices, to say, ‘You know what, we believe in the vision of a low-cost carrier in Canada, here's some 17% money.’ “The balance sheet is not in great shape," Jones added, but noted the interest is "non-cash" — no monthly payments required — and merely adds to the principal. "At some point there will be some form of reckoning, whether it's a restructure or whatever."<br/>