(Montreal) Air Canada said Friday it had repaid about $589 million in debt it used to buy aircraft.
The airline says it has repaid a 462 million loan granted by Export Development Canada (EDC) for the purchase of 14 Airbus A220-300s.
Air Canada also repaid $127 million as part of a partial repayment of US Export-Import Bank-backed financing used to purchase four Boeing 787-8s.
Air Canada said it has made debt reduction one of its key priorities following the pandemic. Accordingly, these repayments strengthen its balance sheet and give it more flexibility for strategic investments.
“Given our very strong liquidity and cash flow position, we will continue to seek other opportunities to further reduce our debt,” John Di Bert, executive vice president and chief financial officer of Air Canada, said in a news release.
Air Canada reported a profit of 838 million euros for the quarter ended June 30, compared with a loss of 386 million euros in the same period last year.
Analyst Walter Spracklin from RBC Capital Markets sees the repayment as positive for the company.
“We believe the actions taken are prudent given the recent sharp increase in fuel prices and the risk that demand for air travel will fluctuate,” Mr. Spracklin wrote in a note to clients.
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