Air Canada has warned of lower margins in its current quarter as the airline battles headwinds from higher fuel costs.
On Friday, the airline said that it predicts its margins from its earnings before interest, taxes, depreciation, amortisation and aircraft rent will be half what they were in the first quarter of last year.
The airline’s shares on the TSX closed down more than eight percent at $13.18.
The Montreal-based carrier stated its adjusted earnings dropped to $38 million from $116 million a year earlier. Simultaneously, Air Canada posted a higher operating revenue of $3.43 billion, up from $3.18 billion.
Air Canada said its yield decreased in the fourth quarter partly due to an increase in the number of seats sold at lower fares on long-haul flights to leisure markets.
Source: CBC News