Transat A.T. Inc. has reported its second quarter 2026 financial results which ended on April 30.
Annick Guérard, President and Chief Executive Officer of Transat, observed that: “Following a solid first quarter that continued the positive momentum of fiscal 2025 and reflected the tangible benefits of our strategic initiatives, second-quarter results were disappointing as factors largely beyond our control severely impacted profitability.”
Guérard continued: “The suspension of flights to Cuba and the material increase in aviation fuel prices, an industry-wide crisis, resulted in an estimated negative impact of $95 million on adjusted EBITDA, of which approximately $70 million is attributable to higher fuel costs in March and April. The impact of rising aviation fuel prices persisted through May, resulting in additional costs compared to the same period last year.”
And Guérard noted that: “Transat has implemented specific measures to mitigate these adverse effects, including surcharges on new bookings and selective capacity adjustments across its network. While surcharges on new bookings were initially well absorbed by consumers and effectively mitigated the impact of rising fuel costs, recent market volatility has weakened pricing power.”
Transat’s President and Chief Executive Officer also said that: “We welcome the introduction by the Government of Canada of the Liquidity for Airline Sector Resilience (LASR) facility, which acknowledges the significant fuel cost pressures currently facing airlines. This initiative reflects the essential role aviation plays in the Canadian economy.”
And Guérard confirmed that: “Transat intends to apply to the LASR facility, which would provide meaningful support as we continue to navigate the current environment with discipline while maintaining our focus on customers and stakeholders.”
Highlights for the second quarter include:
- Revenues of $1,027.6 million, down 0.3% from $1,031.1 million last year
- Negative adjusted EBITDA1 of $20.7 million, compared to an adjusted EBITDA1 of $98.4 million last year
- Net loss of $79.0 million ($1.94 per share), versus net loss of $22.9 million ($0.58 per share) last year
- Free cash flow1 of $59.1 million, compared to $142.3 million last year
- Cash and cash equivalents of $390.1 million as at April 30, 2026
- Repayment of $55.0 million of long-term debt, bringing the balance of long-term debt and deferred government grant to $320.0 million, compared to $812.2 million last year
- Intent to apply to the Government of Canada’s new Liquidity for Airline Sector Resilience facility for up to $150 million in funding to help offsetting the prolonged impact of rising fuel cost
Jean-François Pruneau, Chief Financial Officer of Transat, said that: “Second-quarter adjusted EBITDA declined significantly year-over-year, driven primarily by the surge in aviation fuel costs and the prolonged suspension of flights to Cuba. Profitability was further affected by lower financial compensation from Pratt & Whitney related to the ongoing engine issue, as well as higher salaries and benefits resulting from the new collective agreement with our pilots.
And Pruneau noted that: “Transat intends to apply to the LASR facility, administered by the Canada Enterprise Emergency Funding Corporation (CEEFC), which would provide additional financial flexibility as we remain focused on executing our strategic priorities.”
Go to www.transat.com for more.
