Air Canada 2007 Annual Report Download - page 2

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TABLE OF CONTENTS
Message from Robert Milton .................................................................................................................................... 3
Message from the President and CEO of Air Canada ...................................................................................... 4
Management’s Discussion and Analysis of Results and Financial Condition ......................................... 7
1. Highlights ................................................................................................................................................................. 7
2. Introduction ............................................................................................................................................................. 8
3. Our Strategy ............................................................................................................................................................ 10
4. Results of Operations – Fourth Quarter 2007 versus Fourth Quarter 2006 ....................................... 16
5. Results of Operations – 2007 versus 2006 .................................................................................................... 24
6. Our Fleet .................................................................................................................................................................. 32
7. Financial and Capital Management .................................................................................................................. 34
7.1 Financial Position .................................................................................................................................. 34
7.2 Adjusted Net Debt ............................................................................................................................... 35
7.3 Liquidity ................................................................................................................................................... 36
7.4 Consolidated Cash Flow Movements ............................................................................................. 37
7.5 Contractual Obligations ..................................................................................................................... 38
7.6 Pension Funding Obligations ............................................................................................................. 39
7.7 Capital Expenditures and Related Financing Arrangements .................................................... 40
7.8 Share Information ................................................................................................................................ 42
8. Quarterly Financial Data ..................................................................................................................................... 43
9. Selected Annual Information ............................................................................................................................. 45
10. Derivatives and Financial Instruments ............................................................................................................ 46
11. Off-Balance Sheet Arrangements ..................................................................................................................... 49
12. Related Party Transactions .................................................................................................................................. 50
13. Critical Accounting Estimates ............................................................................................................................ 57
14. Changes in Accounting Policies ......................................................................................................................... 61
15. Future Accounting Standard Changes .............................................................................................................. 63
16. Sensitivity of Results ............................................................................................................................................ 64
17. Risk Factors .............................................................................................................................................................. 65
18. Controls and Procedures ...................................................................................................................................... 74
19. Non-GAAP Financial Measures .......................................................................................................................... 75
20. Glossary .................................................................................................................................................................... 76
Management’s Report ................................................................................................................................................. 77
Independant Auditors’ Report .................................................................................................................................. 78
Consolidated Financial Statements and Notes 2007 ..................................................................................... 79
Offi cers and Directors ................................................................................................................................................. 142
Investor and Shareholder Information ................................................................................................................. 143
Offi cial Languages at Air Canada ............................................................................................................................ 143
Corporate Profi le ........................................................................................................................................................... 144