Labour and engine woes push Transat to a loss as travel company curtails expansion
Transat felt the headwinds of stiff competition, engine recalls and the threat of a union strike last quarter, which together conspired to drain more money from the struggling tour operator. Transat nearly doubled its losses to $54.4m in the three months ended April 30 compared with the same period a year earlier. More cash departed its coffers despite a 12% year-over-year boost in revenue, fuelled by an increase in passengers. “It is clear that this year is a challenging one for Transat,” CE Annick Guérard said on a conference call with analysts Thursday. “Canadians continue to feel the negative impacts of high inflation and high interest rates on their budget. We even see some postponing their spending,” she said. “The demand is there, but it’s not at a growth rate that is as strong as last year.” The losses stemmed partly from lower per-passenger revenue, as Transat’s seat capacity grew more than its ridership. They also resulted from “intensified competition” on routes to sun destinations and the drawn-out possibility of a work stoppage, the Montreal-based company said.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2024-06-07/unaligned/labour-and-engine-woes-push-transat-to-a-loss-as-travel-company-curtails-expansion
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Labour and engine woes push Transat to a loss as travel company curtails expansion
Transat felt the headwinds of stiff competition, engine recalls and the threat of a union strike last quarter, which together conspired to drain more money from the struggling tour operator. Transat nearly doubled its losses to $54.4m in the three months ended April 30 compared with the same period a year earlier. More cash departed its coffers despite a 12% year-over-year boost in revenue, fuelled by an increase in passengers. “It is clear that this year is a challenging one for Transat,” CE Annick Guérard said on a conference call with analysts Thursday. “Canadians continue to feel the negative impacts of high inflation and high interest rates on their budget. We even see some postponing their spending,” she said. “The demand is there, but it’s not at a growth rate that is as strong as last year.” The losses stemmed partly from lower per-passenger revenue, as Transat’s seat capacity grew more than its ridership. They also resulted from “intensified competition” on routes to sun destinations and the drawn-out possibility of a work stoppage, the Montreal-based company said.<br/>
