Air Canada sees core profits in 2025 exceed estimates on international travel demand

(Reuters) – Air Canada forecasts core profits for 2025 exceed Thursday’s analyst estimates as the nation’s largest carrier relies on consistent international travel demand and rebounds in business bookings.

Airlines range from $3.4 billion ($23.9 billion) to CAD 3.8 billion in 2025 before adjusted interest, tax, depreciation and amortization, compared to analysts’ estimates of an average of $3.5 billion. We expect to make profits before profits.

Airlines have seen strong demand for services to the Asia-Pacific region and China, expanding the capacity of these routes.

Canada’s largest airline reported quarterly operating revenue of $5.4 billion in the quarter ended December 31, up 4% from the previous year.

Airlines with international routes take advantage of the growing demand for global travel as consumers focus on experience rather than material.

The Montreal-based company reported a fourth-quarter adjusted profit per share of $0.25 against a loss of 0.12 in the same period last year due to rising labor costs.

However, the costly labor contracts and rising aircraft maintenance costs narrow down the profit margins of airlines.

Last year, Canada’s flagship airline signed a new labor contract with the pilot. This gave the aviator a general four-year cumulative salary increase of about 42%, creating an additional value of around $1.9 billion.

Air Canada faces substantial forex costs due to a decline in Canadian dollar greenback as investors are concerned about the potential impact of a trade war between two neighbouring countries.

Canadians will be hit by a decline in cross-border traffic to the US as Canadians chose to avoid travelling south of the border after a 25% tariff on most Canadian goods. is expected.

Trump suspended 30-day tariffs.

($1 = 1.4198 Canadian dollars)

(Reporting by Shivansh Tiwary, Devika Nair and Mrinmay Dey of Bengaluru, edited by Rashmi Aich and Sherry Jacob-Phillips)