Air Canada suspends financial forecast for 2019 after Boeing 737 Max grounded

Analyst Walter Spracklin of RBC Dominion Securities advised investors not to be alarmed

Canada’s largest airline is suspending its financial guidance for this year following the decision by regulators in Canada and the United States to ground the Boeing 737 Max aircraft until further notice.

Air Canada said Friday that, “in light of the current uncertainty,” it is suspending the forecast it provided last month for its 2019 financial year.

The Montreal-based company said its guidance for the years 2020 and 2021 for return on invested capital and margin on earnings before interest, taxes, depreciation and amortization (EBITDA), as well as the cumulative free cash flow over the 2019-2021 period, remains in place.

Analyst Walter Spracklin of RBC Dominion Securities advised investors not to be alarmed.

WATCH: Canada bans Boeing 737 Max 8 plane following fatal Ethiopian crash

“We believe the company has avenues to work around the grounding, including the longer in-service use of older aircraft, possible access to third-party aircraft, the temporary use of different gauge aircraft and if necessary the temporary suspension of some routes,” he wrote in a research note.

Spracklin said the carrier’s suspension “does not come as unexpected and more importantly, we do not consider it to be impacting our longer-term view on the shares.”

Regulators around the world grounded the Boeing 737 Max 8 and Max 9 aircraft over safety concerns arising from the crash of an Ethiopian Airlines flight that killed everyone on board, including 18 Canadians.

Concerns have been raised regarding apparent similarities with a Lion Air flight involving the same aircraft that crashed off the Indonesian coast in October.

Air Canada has 24 Boeing 737 Max 8 aircraft out of 184 narrow-body planes in its fleet.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Nanaimo students put their robots to the test in competition

High school students from Nanaimo and Ladysmith problem-solve at VEX robotics tournament

Bus loop will now remain in downtown Nanaimo until the end of the year

Shelters installed at temporary Port Drive/Front Street transit exchange

Nanaimo man who fell off cliff returns there to rescue eagle from vulture attack

James Farkas breaks hip in fall from beach cliff, returns months later to save eagle on same beach

Nanaimo athletes win Island track and field championships

Every Nanaimo high school was represented at last week’s event

B.C. Supreme Court dismisses review around ferry workers’ right to strike

B.C. Ferry and Marine Workers’ Union collective agreement expires November 2020

Nanaimo kindergarten teacher receives Prime Minister’s award

Departure Bay Eco-School’s Liz McCaw use of experiential learning methods earns her accolade

So, they found ‘Dave from Vancouver Island’

Dave Tryon, now 72 and living in North Delta, will reunite with long-ago travelling friends in Monterey, Calif.

Kamloops girl, 9, recovering from carbon monoxide poisoning now out of ICU

Her mother who was sleeping in the same tent with her did not survive

‘I think he’s still alive’: B.C. mom pleads for help finding son last seen a month ago

Family offering $5,000 reward for information leading to the safe return of Tim Delahaye

New poll suggests one-third don’t want politicians to wear religious symbols

Local politicians shouldn’t be allowed to wear hijabs, crucifixes or turbans on the job, survey suggests

Raptors fans far from home adjust plans to watch pivotal playoff game

Raptors currently lead the playoff series 3-2, and a win Saturday would vault them into NBA finals

PHOTOS: First responders in Fernie rescue baby owl who fell from nest

The baby owl’s inability to fly back to its nest prompted a rescue by first responders

Five takeaways from the Court of Appeal ruling on B.C.’s pipeline law

It’s unclear how many tools are left in B.C.’s toolbox to fight the project

Beefs & Bouquets, May 23

To submit a beef or a bouquet to the Nanaimo News Bulletin, e-mail bulletinboard@nanaimobulletin.com

Most Read