MONTREAL, Nov. 6 /CNW Telbec/ - ACE Aviation Holdings Inc. (ACE) today filed its interim unaudited consolidated financial statements and MD&A for Quarter 3, 2009 and announced the redemption for cash of its remaining convertible senior notes. In addition, ACE announced that it intends to launch a substantial issuer bid (the Offer) to purchase for cancellation up to $20 million of ACE's Class A Variable Voting Shares and Class B Voting Shares (collectively, the Shares).
Third Quarter Results
ACE recorded consolidated operating income (including Air Canada) of $68 million for the quarter compared to operating income of $105 million for the third quarter of 2008.
ACE reported consolidated EBITDAR(1) of $319 million for the third quarter of 2009, a decrease of $27 million from the third quarter 2008.
ACE recorded consolidated net income of $198 million for the third quarter of 2009.
At October 31, 2009, ACE's principal assets are cash and cash equivalents of $137 million, a secured loan to Air Canada of $150 million and its 75 million Class B voting shares in Air Canada, which had a market value of $77 million on that date. As a result of share issuances by Air Canada in late October 2009, ACE's interest in Air Canada has been reduced from 75% to 27%. ACE's obligations include convertible senior notes with a principal amount outstanding of $64 million and accounts payable and accrued liabilities of $1 million.
Over the past few months, the ACE Board has continued to consider alternatives to maximize the return to shareholders. On November 5, 2009, the Board authorized the redemption for cash of the convertible senior notes and the required notice is being sent to the Trustee today. The notes will be repurchased by December 14, 2009. In addition, consistent with the overall objective of returning excess cash to shareholders, ACE intends, subject to regulatory compliance, to launch a substantial issuer bid to repurchase $20 million of its Shares. Further details will be announced prior to the launch of the Offer. Going forward, the Board will continue to review alternatives to maximize the return to shareholders, including alternatives for its debt and equity interests in Air Canada.
For further information on ACE's public disclosure file, including ACE's Annual Information Form, please consult SEDAR at www.sedar.com.
(1) Non-GAAP Measures
EBITDAR is a non-GAAP financial measure commonly used in the airline industry to assess earnings before interest, taxes, depreciation and aircraft rent. EBITDAR is used to view operating results before aircraft rent and depreciation, amortization and obsolescence as these costs can vary significantly among airlines due to differences in the way airlines finance their aircraft and other assets. EBITDAR is not a recognized measure for financial statement presentation under GAAP and does not have standardized meaning and is therefore not likely to be comparable to similar measures presented by other public companies. Readers should refer to ACE's Third Quarter 2009 Management's Discussion and Analysis (MD&A) for a reconciliation of EBITDAR to operating income (loss).
CAUTION REGARDING FORWARD-LOOKING INFORMATION
Certain statements in this news release may contain forward-looking statements. 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, by their nature, are based on assumptions 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, energy prices, general industry, market, credit and economic conditions, war, terrorist acts, changes in demand due to the seasonal nature of the business, the ability to reduce operating costs and employee counts, employee relations, labour negotiations or disputes, pension issues, currency exchange and interest rates, changes in laws, adverse regulatory developments or proceedings, pending and future litigation and actions by third parties as well as the factors identified throughout ACE's filings with securities regulators in Canada and, in particular, those identified in the Risk Factors section of ACE's Third Quarter MD&A dated November 6, 2009. The forward-looking statements contained herein represent ACE's expectations as of the date they are made and are subject to change after such date. However, ACE 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.
SOURCE ACE Aviation Holdings Inc.
For further information: For further information: Des Beaumont, (514) 205-7639; aceaviation.com