Transat AT's summer woes lead to 28% drop in profit

Transat AT’s summer woes lead to 28% drop in profit

MONTREAL — Transat A.T. Inc. says it’s feeling the impact of an unsettled transatlantic travel market this summer, with net income down 28.2% and adjusted earnings down almost 91% from the same time last year.

The Montreal-based company’s net income dropped to $9.4 million or 26 cents per share, from $13.1 million or 34 cents per share in last year’s third quarter.

Nearly one-quarter of the third quarter’s net income – $2.5 million – was attributed to Transat’s 35% interest in Ocean Hotels.

Transat says the strength of the U.S. dollar helped increase Ocean Hotel’s contribution from $1.6 million last year.

Adjusted profit was $2.5 million or seven cents per share, down from $26.9 million or 70 cents per share, and revenue was $663.6 million, down six per cent from $704.8 million a year ago.

Transat’s president and CEO, Jean-Marc Eustache, says this year’s third quarter ended July 31 was marked by rapid changes in demand because of terrorism-related fears and a dramatic increase in the travel industry’s transatlantic capacity.

Eustache says the company is relatively satisfied with its results given the circumstances, but says there’s no hope of a repeat of the “outstanding” performance achieved in the previous two summer seasons.