Chorus Aviation announces expansion of Jazz fleet - CPA covered fleet to increase by 10 incremental growth aircraft by 2017

HALIFAX, Sept. 28, 2015 /CNW/ - Chorus Aviation Inc. ('Chorus') (TSX: CHR.B CHR.A) today announced that it will add 10 incremental growth aircraft to the Jazz Aviation LP ('Jazz') CPA fleet.  These aircraft will be operated under the Air Canada Express brand per Jazz's Capacity Purchase Agreement ('CPA') with Air Canada.  Five 78-seat Q400 turboprops and five 75-seat CRJ705 regional jets will be delivered in 2016 and early 2017 respectively, and will remain in the CPA covered fleet until 2025.

"We're very pleased to be experiencing this growth in Jazz's fleet less than nine months after establishing the new commercial agreement with Air Canada," said Joseph Randell, President and Chief Executive Officer, Chorus.  "The addition of these 10 incremental aircraft demonstrates the confidence in Jazz's reputation for being one of North America's strongest regional operators and its ever-increasing cost competitiveness. While not material to the current $109.0 million annual fixed fee paid to Jazz under the CPA, the transaction will add another $2.0 million in such fees annually.  The addition of these larger gauged aircraft will further help reduce Jazz's unit cost and increase its market competitiveness. These aircraft are in addition to the fleet modernization plan currently underway as a result of the recently amended CPA with Air Canada which originally called for a minimum of 44 Q400s and 16 CRJ705s by the year 2020."

Previous Q400 and CRJ705 fleet plan

Aircraft
Type

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

Q400

27

37

39

39

39

44

44

44

44

44

44

CRJ705

16

16

16

16

16

16

16

16

16

16

16

New Q400 and CRJ705 fleet plan 

Aircraft
Type

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

Q400

27

42

44

44

44

49

49

49

49

49

49

CRJ705

16

16

21

21

21

21

21

21

21

21

21

 *No change to Dash 8-100, Dash 8-300 and CRJ200 fleet.

The five incremental growth Q400s will be sourced by Air Canada and leased into the Jazz CPA operation.  Sourcing for the CRJ705 aircraft has not yet been finalized.

Forward Looking Statements

Certain statements in this news release may contain statements which are forward-looking. These forward-looking statements are identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions. Such statements may involve but are not limited to comments with respect to strategies, expectations, planned operations or future actions.

Forward-looking statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and other uncertain events. Forward-looking statements, by their nature, are based on assumptions, including those described below, and are subject to important risks and uncertainties. Any forecasts or forward-looking predictions or statements cannot be relied upon due to, amongst other things, changing external events and general uncertainties of the business. Such statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements to differ materially from those expressed in the forward-looking statements. Results indicated in forward-looking statements may differ materially from actual results for a number of reasons, including without limitation, risks relating to Chorus' relationship with Air Canada, the airline industry, airline leasing, energy prices, general industry, market, credit, and economic conditions, (including a severe and prolonged economic downturn which could result in reduced payments under the amended CPA), competition, insurance issues and costs, supply issues, war, terrorist attacks, aircraft incidents, epidemic diseases, environmental factors, acts of God, changes in demand due to the seasonal nature of the business, the ability of Chorus to reduce operating costs and employee counts, the ability of Chorus to secure financing, employee relations, labour negotiations or disputes, pension issues, currency exchange and interest rates, leverage and restructure covenants in future indebtedness, uncertainty of dividend payments, managing growth, changes in laws, adverse regulatory developments or proceedings, pending and future litigation and actions by third parties. The forward-looking statements contained in this discussion represent Chorus' expectations as of September 28, 2015, and are subject to change after such date. However, Chorus disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.

About Chorus
Chorus is traded on the Toronto Stock Exchange under the trading symbols of CHR.A and CHR.B.

Headquartered in Halifax, Nova Scotia, Chorus was incorporated on September 27, 2010 and is a dividend-paying holding company with various interests including Jazz Aviation Holdings Inc. and Chorus Aviation Holdings II Inc.

www.chorusaviation.ca

 

SOURCE Chorus Aviation Inc.

For further information: Chorus Media Contacts: Teri Udle, Halifax, Nova Scotia, (902) 873-5047, tudle@chorusaviation.ca; Debra Williams, Toronto, Ontario, (905) 671-7769, dwilliams@chorusaviation.ca; Analyst Contact: Nathalie Megann, Halifax, Nova Scotia, (902) 873-5094, nmegann@chorusaviation.ca

RELATED LINKS
http://www.flyjazz.ca

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