Air Canada 2009 Annual Report Download - page 28

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2009 Air Canada Annual Report
28
The table below describes year-over-year percentage changes in other passenger revenues, capacity, traffi c, passenger load
factor, yield and RASM by quarter and for the full year.
2009 versus 2008 (% change)
Other Q1 Q2 Q3 Q4 Full Year
Passenger Revenue (11.2) (23.3) (20.1) (10.8) (15.8)
Capacity (ASMs) 4.2 (6.6) (7.2) (0.1) (1.7)
Traffi c (RPMs) 1.4 (8.0) (7.6) 3.3 (2.3)
Passenger Load Factor (pp Change) (2.2) (1.2) (0.4) 2.6 (0.5)
Yield (12.4) (16.7) (13.5) (13.7) (13.8)
RASM (14.8) (17.9) (13.9) (10.7) (14.4)
Cargo revenues decreased 30% from 2008
Cargo revenues amounted to $358 million in 2009 and were $157 million or 30% below 2008 on a 7% reduction to cargo
capacity. One half of the revenue decline in 2009 was due to signifi cantly reduced fuel surcharge rates and the cancellation,
in 2008, of freighter fl ying. Weak economic conditions, especially in the fi rst nine months of 2009, resulted in reduced traffi c
volumes and increased competitive pressure on rates which also contributed to the revenue decline.
Freighter revenues declined $29 million as no MD-11 freighter aircraft were operated in 2009 versus one MD-11 freighter
which operated to Europe in the fi rst six months of 2008. Freighter operations were terminated in June 2008.
Non-freighter revenues decreased $129 million or 26%, refl ecting a 6% system-wide traffi c reduction mainly in North American
markets. System cargo yield decreased 22% due to signifi cantly lower fuel surcharges and competitive pressure on rates.
Factors contributing to the year-over-year change in cargo revenues included:
• A decrease in domestic cargo revenues of 35% on 29% less traffi c and a 9% decline in yield per RTM. The termination
of the Canada Post contract in September 2008 accounted for around three quarters of the traffi c decrease. Domestic
capacity was down 12% versus 2008.
• A decrease in Atlantic non-freighter revenues of 30% on 6% less traffi c and a 26% lower yield per RTM.
• A decrease in Pacifi c revenues of 21% on fl at traffi c and a 21% lower yield per RTM. Pacifi c capacity was down 10%.
• A system traffi c decline of 11% (including the impact of the freighter termination in June 2008) and a yield per RTM
decline of 22%.
• A weaker Canadian dollar versus 2008 had a positive impact on foreign currency denominated revenues of
$11 million in 2009.
Other revenues increased 3% from 2008
Other revenues of $882 million in 2009 increased $28 million or 3% from 2008, primarily due to an increase of
$46 million in third party revenues at Air Canada Vacations, mainly the result of higher passenger volumes, and an increase of
$11 million in aircraft sublease revenues. Various factors, including a decrease in revenues from Aeroplan for services related
to information technology, amounting to a net decrease of $28 million partly offset these increases.
CASM decreased 5.4% from 2008. Excluding fuel expense, CASM increased 3.3% from 2008
Operating expenses were $10,055 million in 2009, a decrease of $1,066 million or 10% from 2008. A reduction in fuel
expense of $971 million or 28% was a major factor in the year-over-year decrease in operating expenses. This operating
expense reduction was achieved in spite of the unfavourable impact of a weaker average Canadian dollar versus the
U.S. dollar in 2009 on U.S. denominated operating expenses which resulted in additional operating expenses of $230 million
in 2009.