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UPDATE 2-Air Canada profit beats estimates as it flies more passengers
November 7, 2016 / 11:53 AM / in a year

UPDATE 2-Air Canada profit beats estimates as it flies more passengers

(Adds forecast)

Nov 7 (Reuters) - Air Canada reported a better-than-expected quarterly profit on Monday as it flew more passengers, including on new international routes, and the airline forecast lower costs for the current quarter.

Canada’s largest airline said it expects cost per available seat mile (CASM), excluding fuel costs and unusual items, to decline 5-6 percent in the fourth quarter, and by 2.75-3.75 percent this year.

Air Canada said adjusted CASM, a measure of how much an airline spends to fly a passenger, fell 5.9 percent in the third quarter.

Apart from lower costs, the company also benefited from increased traffic on its routes.

Air Canada said there was 27.9 percent growth in international-to-international passengers connecting via Canada.

The carrier added seven non-stop routes to Europe and one each to Asia, Africa and Australia this year.

Traffic increased almost 19 percent, while fuel cost per litre fell 10.2 percent.

Air Canada said net income jumped 75.7 percent to C$768 million ($573 million), or C$2.74 per share, in the quarter ended Sept. 30, from a year earlier.

Excluding items, the company earned C$2.93 per share, above the average analyst estimate of C$2.55, according to Thomson Reuters I/B/E/S.

The Montreal-based airline’s revenue rose 10.6 percent to C$4.45 billion, beating analysts’ average estimate of C$4.30 billion. ($1 = C$1.34) (Reporting by Ahmed Farhatha in Bengaluru; Editing by Maju Samuel)

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