Aviation.ca - Your Number One Source for Canadian Aviation News, Jobs and Information!

"We are extremely happy to have once again turned a difficult economic period into another profitable quarter," said WestJet President and CEO Sean Durfy. "For more than a year now, economic instability has been eroding consumer confidence. The third quarter saw continued scrutiny from price-sensitive Canadians, resulting in airlines stimulating demand through aggressive pricing. Regardless, we believe we will produce margins that are among the best in North America. Our success this quarter, and every quarter, is a direct result of the efforts and abilities of WestJetters who are committed to ensuring guests receive the best value for their hard-earned dollars."

WestJet reported an operating margin of 12.8 per cent, compared to 14.0 per cent in the third quarter of 2008. WestJet's third quarter 2009 pre-tax margin was 8.3 per cent, compared to 11.5 per cent in the same 2008 period.

"Relief from significantly lower fuel costs, compared to the same period in 2008, considerably off-set our drop in revenue," added Sean Durfy. "Our ability to successfully stimulate demand while keeping our controllable costs in line played an important part in our strong margins."

"Throughout the quarter, we remained committed to our strategy," stated Sean Durfy. "The recent successful cutover to our new reservation system was a major milestone for our airline. This transition from our old system to our new system has been difficult on our guests and our people. We are extremely appreciative of our guests, who have shown tremendous loyalty and patience, as we implement changes that will enhance the benefits we can provide. We offer a heartfelt apology for this inconvenience and assure you that we will be back to our high standards of excellent service very soon."

Sean Durfy continued, "Our new reservation system provides the capabilities necessary to properly support our growing business and deliver on key strategic initiatives like attracting more business travellers, increasing ancillary revenue and enabling airline partnerships. Completing a project of this magnitude was no small feat, and it wouldn't have been possible without our hard-working team of WestJetters who are extremely invested in the success of our airline."

In the third quarter, WestJet revised its aircraft delivery schedule and completed an equity offering that brought the airline's cash balance to $961.6 million.

"The challenges that we encountered leading up to the end of the third quarter are creating a lot of uncertainty around the remainder of 2009 and into 2010," explained Sean Durfy. "We smoothed our aircraft delivery schedule, enhanced flexibility around our fleet and capacity, and added 14 more aircraft to our future growth plans. Our equity offering strengthened our balance sheet and provided an additional level of comfort for meeting our future growth commitments."

Throughout the remainder of the year, WestJet will implement its Frequent Guest Program and co-branded credit card program; continue to grow its vacations business, which is already seeing year-to-date revenue improvements of over 80 per cent; and take delivery of an additional five aircraft for an end-of-year fleet size of 86.

"Capacity for the fourth quarter is expected to increase two to three per cent, with all new capacity being deployed into our transborder and international markets," said Sean Durfy. "We have enhanced our winter schedule with 10 new sun destinations, and bookings for WestJet Vacations remain strong."

"We are encouraged by talks of recovery," commented Sean Durfy. "In the past six to eight weeks, we have seen indications that RASM declines have levelled off, and we are seeing signs of improvement from what we were previously experiencing. While it is still too early to predict the strength or speed of a potential recovery, we feel optimistic about the future and the continued success of our airline."

WestJet also reported third quarter improvements for all three categories of operational performance. WestJet calculates its on-time performance and completion rate based on the U.S. Department of Transportation's standards. WestJet's baggage ratio represents the number of delayed or lost baggage claims made per 1,000 guests. The airline strives to be one of the top North American airlines for these three operational performance metrics.

Caution regarding forward-looking statements

Certain information set forth in this press release, including but not limited to information regarding WestJet's operational plans for the remainder of 2009, capacity projections, new winter schedule, anticipated aircraft delivery schedule, implementation of strategic programs and projections as to RASM in the fourth quarter of 2009, contain forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond WestJet's control. These forward-looking statements are based on currently available implementation plans, agreements and bookings, but may vary due to factors including, but not limited to, delay in aircraft delivery, change in customer demand, general economic conditions, H1N1 impact and availability of personnel and outside consultants. These and additional risk factors are discussed in WestJet's most recent Annual Information Form (AIF) and in other documents WestJet files from time to time with securities regulatory authorities, which are available through the Internet on WestJet's SEDAR profile at www.sedar.com.

Readers are cautioned that undue reliance should not be placed on forward-looking statements as actual results may vary materially from the forward-looking statements. WestJet does not undertake to update any forward-looking statements, except as is required by law.

The Management's Discussion and Analysis and Consolidated Financial Statements and Notes for the three and nine months ended September 30, 2009, are available through the Internet on westjet.com or WestJet's SEDAR profile at www.sedar.com.

Conference call

WestJet will hold its quarterly analysts' conference call today at 9 a.m. MST (11 a.m. EST). WestJet President and CEO Sean Durfy, and Executive Vice-President of Finance and CFO Vito Culmone, will discuss WestJet's third quarter 2009 results and answer questions from financial analysts. The conference call is available by calling 1-416-644-3417 (in Toronto) or through the toll-free telephone number 1-800-733-7560. The call can also be heard live through an Internet webcast in the Media and Investors section of westjet.com

. About WestJet

WestJet is Canada's preferred airline, offering scheduled service throughout its 66-city North American and Caribbean network. Named one of Canada's most admired corporate cultures in 2005, 2006, 2007 and 2008, WestJet pioneered low-cost flying in Canada. WestJet offers increased legroom, leather seats and live seatback television provided by Bell TV on its modern fleet of 81 Boeing Next-Generation 737 aircraft. With future confirmed deliveries for an additional 54 aircraft through 2016, WestJet strives to be one of the five most successful international airlines in the world.