WestJet delays launch of discount airline until 2018
Original plan had been to start discount airline this year
The Canadian Press Posted: Aug 01, 2017 10:15 AM ET Last Updated: Aug 01, 2017 11:45 AM ET
WestJet says the launch of its new no-frills, low-cost airline won't be until next summer after initially announcing plans it would start offering flights later this year.
The Calgary-based airline says it expects to announce the initial flight schedule early in 2018 with service expected to start in the summer of next year.
The airline will operate 10 modified high-density 737 jets. The plan is to expand the size of that fleet over time, the airline said on a conference call with analysts.
The news of the delay came as WestJet reported it earned $48.4 million or 41 cents per diluted share in its latest quarter.
That compared with a profit of $36.7 million or 30 cents per diluted share in the same quarter last year.
Revenue in the quarter totalled nearly $1.06 billion, up from $949.3 million a year ago.
WestJet says its operating margin grew to 7.4 per cent for the three-months ended June 30 compared with 6.5 per cent in the same quarter last year.
Capacity measured by available seat miles increased 6.3 per cent, while traffic measured by revenue passenger miles grew 8.9 per cent
The airline's load factor, a closely watched metric of how full the company's planes are, rose to 82.8 per cent during the quarter.
WestJet said it expects to benefit from a resurgent economy in its home province of Alberta. "Alberta-based revenue was up 10 per cent, year over year," CEO Gregg Saretsky said. "It really bodes well for WestJet."
The airline did say, however, that it's paying more for jet fuel than it used to. The average cost of a barrel of jet fuel rose to $61 during the quarter. A year earlier, the airline paid on average $57 for a barrel of fuel.With files from CBC News Articled from the CBC RSS Syndication CBC.ca - RSS Feeds Copyright is that of their respective owners (CBC) Calgary News Releases
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