Transat A.T. (TSE:TRZ) Releases Quarterly Earnings Results

Transat A.T. (TSE:TRZ) posted its quarterly earnings results on Thursday. The company reported C($2.18) earnings per share for the quarter, FiscalAI reports. The company had revenue of C$792.72 million during the quarter. Transat A.T. had a net margin of 8.11% and a negative return on equity of 41.23%.

Here are the key takeaways from Transat A.T.’s conference call:

• High fuel prices severely pressured profitability: Q3 revenue rose 3% to CAD 793 million, but adjusted EBITDA fell to negative CAD 1 million from positive CAD 81 million, while adjusted net loss widened to CAD 89 million. Fuel expense increased 50% year over year, and management said current fares still do not fully cover the higher costs.
• Liquidity and operating risks remain elevated. Free cash flow was negative CAD 302 million in Q3, cash declined to CAD 243 million, and four aircraft remained grounded because of Pratt & Whitney GTF engine issues; related disruptions and costs are expected to persist until at least 2028. Transat has fully drawn CAD 150 million under LASR and expects an additional CAD 250 million government loan to provide sufficient liquidity based on the current fuel-price forward curve.
• Demand remained resilient despite intense competition. Revenue and traffic increased, transatlantic yield rose 0.6% despite 8% capacity growth, and fourth-quarter load factor is currently 0.6 percentage points ahead of last year with yield broadly stable. Management plans no capacity growth for the upcoming winter and is reallocating capacity toward stronger-performing destinations.
• Strategic revenue initiatives are progressing. The loyalty program has more than 23,000 beta members and is tracking ahead of initial engagement expectations, while cabin reconfigurations beginning in the second half of 2027 are intended to expand premium seating and ancillary revenue. Management expects the loyalty program’s material contribution to emerge over roughly three years.

Transat A.T. Price Performance

Transat A.T. stock opened at C$2.01 on Friday. Transat A.T. has a 52 week low of C$2.00 and a 52 week high of C$3.10. The company’s 50 day moving average price is C$2.30 and its two-hundred day moving average price is C$2.46. The stock has a market cap of C$82.48 million, a P/E ratio of 0.30, a P/E/G ratio of -0.04 and a beta of 1.49. The company has a quick ratio of 0.76, a current ratio of 0.63 and a debt-to-equity ratio of -186.46.

Wall Street Analysts Forecast Growth

A number of research analysts have weighed in on the stock. TD dropped their price objective on shares of Transat A.T. from C$2.50 to C$2.25 and set a “hold” rating on the stock in a research note on Friday, June 12th. National Bank Financial lowered shares of Transat A.T. from a “sector perform” rating to an “underperform” rating and lowered their target price for the stock from C$3.00 to C$2.25 in a report on Wednesday, May 27th. Three investment analysts have rated the stock with a Hold rating and two have assigned a Sell rating to the company’s stock. According to MarketBeat, Transat A.T. has a consensus rating of “Reduce” and an average price target of C$2.61.

Transat A.T. Company Profile

Air Transat is a leading travel brand voted 2025 World’s Best Leisure Airline by passengers at the Skytrax World Airline Awards. Its program offers access to international destinations, mainly in Europe, the Caribbean, the east coast of the United States, South America and North Africa. Air Transat is recognized for its excellent customer service. Its fleet includes some of the most energy-efficient aircraft in their category. Based in Montreal with major hubs in YUL Montréal-Trudeau International Airport and Toronto Pearson Airport (YYZ), it has 5,000 employees with a common purpose to bring people closer together.