WestJet third-quarter profit rises as it carries more passengers

WestJet Airlines Ltd. saw its thirdquarter profit grow by about 20 per cent compared with a year ago as it increased capacity and traffic.

The airline says it earned $138.4 million or $1.18 per diluted share for the quarter that ended Sept. 30.

That compared with a profit of $116.0 million or 97 cents per diluted share in the same quarter last year.

Revenue totalled $1.22 billion, up from $1.12 billion.

Capacity in the quarter measured by available seat miles increased 5.8 per cent, while traffic measured by revenue passenger miles increased 7.9 per cent compared with a year ago.

WestJet’s load factor for the quarter amounted to 85.7 per cent, up from 84.0 per cent.

Flying on WestJet’s low-cost carrier Swoop will come with a price: ancillary fees that will cost travellers about twice what they pay on the mainline carrier, the CEO of the Calgary-based airline said Tuesday.

Gregg Saretsky said he expects nonfare fees on Swoop will be very similar to so-called ultra low-cost carriers in the U.S.

“We’re about $19 per guest currently on the mainline operation and I would expect that we should be able to get (double) that on Swoop,” he said during a conference call about its third-quarter results.

WestJet’s fees for services like flight changes, cancellations and checked bags increased 12 per cent in the third quarter to $117 million, or $18.64 per passenger.

Premium economy seat revenues were up 19 per cent in the quarter.

Swoop is set to launch service in June with two 189-seat Boeing 737- 800s. The fleet will increase to six planes by September and 10 in the summer of 2019.

Modelled after the relationship between Australia’s Qantas Airways and Jetstar Airways Pty Ltd., Swoop will fly mostly to different destinations than WestJet, but may also supplement the larger airline on major city routes, Saretsky added.

“They’ll be high-utilization aircraft because they’ll turn and burn and they’ll have more utilization than WestJet’s fleet.”

He said Swoop will operate as an independent airline with its own res- ervation system, operator’s certificate and airport check-in counters staffed by its own employees.

“We have been very resolute in wanting to build this at the absolute lowest (cost), so there will not even be connectivity between Swoop and WestJet,” he told analysts.

Passengers flying on Swoop from Calgary to Toronto, for example, will have to collect their bags and recheck them for corresponding flights to Sudbury.

Swoop’s financial results, however, will be incorporated with those of WestJet.