Air Canada Updates 2023 Guidance.

MONTREAL: Air Canada today updates its 2023 financial and capacity guidance.

Air Canada is updating its guidance for 2023. The revised guidance for adjusted EBITDA* reflects expected earnings resulting from an improvement in traffic and yield from a stronger-than-anticipated demand environment and lower-than expected fuel price. The revised guidance for adjusted CASM* reflects adjustments to various expense items including those resulting from the higher-than-expected traffic. Air Canada's 2023 capacity guidance remains substantially unchanged.

Air Canada is also modifying the baseline comparison for its 2023 adjusted CASM guidance, comparing it to a 2022 instead of a 2019 baseline. Given the new cost environment, prior comparisons to the 2019 baseline are no longer as meaningful, and comparisons to 2022 are more appropriate.

Air Canada is providing the following updates to its 2023 guidance.

Metric

Full Year 2023 Guidance

Prior Guidance

(Provided on February 17, 2023)

Updated Guidance

(Provided on May 4, 2023)

ASM capacity

About 24 per cent increase versus 2022 (~90 per cent of 2019 levels)

About 23 per cent increase versus 2022 (~90 per cent of 2019 levels)

Adjusted CASM*

About 13 to 15 per cent above 2019 levels

About 0.5 to 2.5 per cent below 2022 levels

Adjusted EBITDA*

About $2.5 - $3.0 billion

About $3.5 - $4.0 billion

Air Canada is not updating its 2024 targets at this time and will continue evaluating them as it progresses towards its plans and executes on its strategic priorities.

*Adjusted CASM and adjusted EBITDA referred to in this news release, are non-GAAP financial measures. Such measures are not recognized measures for financial statement presentation under GAAP, do not have standardized meanings, may not be comparable to similar measures presented by other entities and should not be considered a substitute for or superior to GAAP results. Refer to the "Non-GAAP Financial Measures" section of this news release for descriptions of these measures, and for a reconciliation of Air Canada non-GAAP measures used in this news release to the most comparable GAAP financial measure.

Major Assumptions

Assumptions were made by Air Canada in preparing its updated guidance. As part of its assumptions, Air Canada assumes moderate Canadian GDP growth for 2023. Air Canada also assumes that the Canadian dollar will trade, on average, at C$1.34 per U.S. dollar for the full year 2023 and that the price of jet fuel will average C$1.09 per litre...