NAV CANADA announces third quarter financial results

    OTTAWA, July 9 /CNW Telbec/ - NAV CANADA today released its financial
results for the three and nine months ended May 31, 2009. Continuing declines
in air traffic revenue were partially offset by cost containment during the
quarter.
    "Working with employees and all our stakeholders, the Company has been
able to absorb the impact of declining air traffic and revenues without having
to increase our service charges," said John Crichton, NAV CANADA President &
CEO. "We announced in June that no rate increase is planned at this time.
    "Our customers have been saving approximately $ 50 million per year as a
result of service charge reductions in 2006 and 2007. However, while we are
currently holding the line on service charge increases, we are monitoring
traffic on a monthly basis, and are prepared to consider a rate increase
should this be required, no later than October for effect in 2010."
    The Company's revenues before rate stabilization for the third quarter of
fiscal 2009 were $ 284 million, compared to $ 305 million for the same period
in the previous year. The lower revenues arose primarily from a decline in air
traffic volumes. Traffic during the third quarter was 8.1 per cent lower than
in the third quarter of 2008.
    Operating expenses before rate stabilization for the quarter were $ 241
million which was $ 9 million lower than the comparable period in the prior
year. Management continues to effectively manage overtime and headcount to
offset somewhat higher compensation levels.
    During the third quarter, other expenses before rate stabilization
totalling $ 66 million were $ 3 million higher than in the comparable period
in the prior year. This was primarily due to higher depreciation relating to
new capital assets.
    Before rate stabilization adjustments are taken into account, expenses
exceeded revenues and other income by $ 22 million in the third quarter of
fiscal 2009. While NAV CANADA intends to break even on an annual basis,
quarterly results may indicate an imbalance between revenues and expenses due
to seasonal fluctuations in air traffic and other factors. The excess of
expenses over revenues and other income (before rate stabilization and rate
reduction) for the third quarter of 2008 was $ 56 million.
    The Company finished the third quarter with a recoverable asset balance
of $ 27 million in the rate stabilization account. However, for rate setting
purposes, the liability balance in the "notional" rate stabilization account
is considered to be approximately $ 93 million, since the majority of the
cumulative fair value adjustments that have been provided on its asset-backed
commercial paper investments should be recoverable over the time that the
Company continues to hold them.
    The Company's Financial Statements and Management's Discussion and
Analysis for the three and nine months ended May 31, 2009 are available on NAV
CANADA's website at: www.navcanada.ca.

    NAV CANADA, the country's civil air navigation services provider, is a
private sector, non-share capital corporation financed through publicly-traded
debt. With operations coast to coast, NAV CANADA provides air traffic control,
flight information, weather briefings, aeronautical information services,
airport advisory services and electronic aids to navigation.

    This press release contains certain forward-looking statements that are
subject to important risks and uncertainties. Actual results may differ
materially from the results indicated in these statements for a number of
reasons. NAV CANADA disclaims any intention to update any forward-looking
statements.

For further information: John Morris, Director, Communications, (613)
563-7032; Ron Singer, Manager, Media Relations, (613) 563-7303; Media
Information Line: 1-888-562-8226, www.navcanada.ca