Chorus Aviation, reporting share loss, confident service demand will return
Adjusted profit plunged 62.6 per cent to $10.9M compared with last year
HALIFAX— Shares of Chorus Aviation Inc. fell as much as 12.7 per cent Wednesday after the regional aviation company reported third-quarter results that missed expectations as it continues to feel the effects of COVID-19.
The Halifax-based company’s shares dipped 2.97 per cent on Wednesday to close at $3.59.
Chorus said it earned $20.5 million, or 13 cents per share, in the quarter, down 15.4 per cent from $24.2 million, or 15 cents per share.
Adjusted profit plunged 62.6 per cent to $10.9 million, or seven cents per share, compared with $29.1 million, or 18 cents per share, in the third quarter of 2019.
Revenue for the three months ended Sept. 30 was $196.4 million, down 44.1 per cent from $351.4 million in the prior year.
Analysts on average forecast adjusted earnings of 11 cents per share on $204.3 million of revenues, according to financial data firm Refinitiv.
“While we were modestly encouraged by the increases in flying by our lessees and our Air Canada Express operation, this fall has seen the further proliferation of the COVID-19 virus worldwide and a corresponding stalling in the resumption of flying activities,” stated CEO Joe Randell.
He said demand for air service will only return when people have confidence that their health and safety are protected, and when the requirement for quarantine is reduced or eliminated.
Chorus says it expects Jazz to operate at 20 per cent to 30 per cent of its capacity in the fourth and first quarters due to travel restriction and mandatory quarantines.
“Overall, while domestic air travel demand continues to remain suppressed … we believe that recent developments (ie.
Pfizer vaccine data and anticipated financial aid from the Canadian government) have helped shift the narrative from survival to recovery,” said Walter Spracklin of RBC Dominion Services.