Air Canada 2014 Annual Report Download - page 81

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81
2014 Management’s Discussion and Analysis
ADJUSTED NET INCOME AND ADJUSTED NET INCOME PER SHARE – DILUTED
Air Canada uses adjusted net income and adjusted net income per share – diluted to assess the performance
of its business without the effects of foreign exchange, net financing income (expense) relating to employee
benefits, mark-to-market adjustments on fuel and other derivatives and unusual items. These measures are not
recognized measures for financial statement presentation under GAAP, do not have a standardized meaning and
may not be comparable to similar measures presented by other public companies.
CANADIAN DOLLARS IN MILLIONS,
EXCEPT PER SHARE VALUES
FOURTH QUARTER FULL YEAR
2014 2013 $ Change 2014 2013 $ Change
NET INCOME (LOSS) FOR THE PERIOD
ATTRIBUTABLE TO SHAREHOLDERS $ (101) $ (7) $ (94) $ 100 $ 6 $ 94
Adjusted for:
One-time payments – ACPA (1) 30 -30 30 -30
Benefit plan amendments (2) -(82) 82 -(82) 82
Tax-related provision adjustments (3) ---(41) -(41)
Impairment charge (4) - 6 (6) -30 (30)
Foreign exchange loss 115 55 60 307 120 187
Interest charge (5) - - - - 95 (95)
Net financing expense relating to employee
benefits 32 53 (21) 134 208 (74)
(Gain) loss on fuel and other derivatives (9) (22) 13 1(37) 38
ADJUSTED NET INCOME $ 67 $ 3 $ 64 $ 531 $ 340 $ 191
Weighted average number of outstanding shares
used in computing diluted income per share (in
millions)
294 291 3293 284 9
ADJUSTED NET INCOME PER SHARE – DILUTED $ 0.23 $ 0.01 $ 0.22 $ 1.81 $ 1.20 $ 0.61
1 In 2014, one-time payments totaling $30 million were made to ACPA members under a collective agreement concluded in October 2014.
2 In 2013, Air Canada recorded an operating expense reduction of $82 million related to amendments to defined benefit pension plans.
3 In 2014, Air Canada recorded favourable tax-related provision adjustments of $41 million.
4 In 2013, Air Canada recorded impairment charges amounting to $30 million.
5 In 2013, Air Canada recorded an interest charge of $95 million related to the purchase of its senior secured notes due in 2015 and 2016.
The following reflects the share amounts used in the computation of basic and diluted earnings per share on an
adjusted net income per share basis:
IN MILLIONS
FOURTH QUARTER FULL YEAR
2014 2013 2014 2013
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING – BASIC 286 282 286 277
Effect of potential dilution 8977
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING – DILUTED 294 291 293 284