Air Canada 2014 Annual Report Download - page 4

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4
MESSAGE FROM THE PRESIDENT AND
CHIEF EXECUTIVE OFFICER
2014 was a breakout year for Air Canada, where the
Corporation showed what we are truly capable of.
Record sales. Record EBITDAR. Record Adjusted Net
Profit. Record number of passengers carried. Record
load factor. Best airline in North America for the fifth
year in a row.
Adjusted net income of $531 million ($1.81 per
diluted share) exceeded the previous year’s record
by $191 million ($0.61 per diluted share) or by
56.2 per cent. On a GAAP basis, annual net income
was $105 million ($0.34 per diluted share), up from
$10 million ($0.02 cents per diluted share) in the prior
period. EBITDAR was $1.67 billion, an improvement
of 16.6 per cent over 2013 excluding the impact of
benefit plan amendments.
These results were achieved thanks to everyone in
the organization working together to both effectively
increase revenues and take bold action to reduce
costs. We achieved an operating margin of 6.1 per
cent in 2014, up 1.8 percentage points from the
previous year, excluding the impact of benefit
plan amendments.
I am extremely pleased to see Air Canada execute
on our margin enhancement strategies and build
a sustainably profitable enterprise. Return on
invested capital at year end was 12.1 per cent, versus
10.5 per cent a year earlier. This puts us squarely
within our stated target of a sustainable ROIC of
10-to-13 per cent by 2015.
Operating revenue grew for the sixth consecutive
year to reach a record $13.3 billion, up $890 million
from 2013. All market segments showed an increase,
with passenger revenue climbing 7.1 per cent over
2013. As anticipated and planned, passenger yield on
a stage length adjusted basis decreased 1.3 per cent,
attributable to our strategy of profitably increasing
long-haul international flying, particularly in the
leisure market using incremental lower cost capacity.
Overall, we achieved a 2.6 per cent reduction in
adjusted unit costs despite an unfavourable currency
impact owing to the much weaker Canadian dollar as
compared to the previous year.
Air Canada flew more customers than ever in 2014,
with a passenger load factor of 83.4 per cent. We
ended the year with nearly $2.7 billion in liquidity,