Air Canada suspends financial forecast for 2019 after Boeing 737 Max grounded

Analyst Walter Spracklin of RBC Dominion Securities advised investors not to be alarmed

Canada’s largest airline is suspending its financial guidance for this year following the decision by regulators in Canada and the United States to ground the Boeing 737 Max aircraft until further notice.

Air Canada said Friday that, “in light of the current uncertainty,” it is suspending the forecast it provided last month for its 2019 financial year.

The Montreal-based company said its guidance for the years 2020 and 2021 for return on invested capital and margin on earnings before interest, taxes, depreciation and amortization (EBITDA), as well as the cumulative free cash flow over the 2019-2021 period, remains in place.

Analyst Walter Spracklin of RBC Dominion Securities advised investors not to be alarmed.

WATCH: Canada bans Boeing 737 Max 8 plane following fatal Ethiopian crash

“We believe the company has avenues to work around the grounding, including the longer in-service use of older aircraft, possible access to third-party aircraft, the temporary use of different gauge aircraft and if necessary the temporary suspension of some routes,” he wrote in a research note.

Spracklin said the carrier’s suspension “does not come as unexpected and more importantly, we do not consider it to be impacting our longer-term view on the shares.”

Regulators around the world grounded the Boeing 737 Max 8 and Max 9 aircraft over safety concerns arising from the crash of an Ethiopian Airlines flight that killed everyone on board, including 18 Canadians.

Concerns have been raised regarding apparent similarities with a Lion Air flight involving the same aircraft that crashed off the Indonesian coast in October.

Air Canada has 24 Boeing 737 Max 8 aircraft out of 184 narrow-body planes in its fleet.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

PHOTOS: Luxton Fall Fair a hit on the West Shore

Hundreds gather for the family-friendly annual event

Serious crash closes Saanich intersection

Police are asking people to avoid the intersection at Cumberland and Union roads

Child psychologist will speak to SD62 staff about challenging behaviours

Author of The Explosive Child and Lost at School will speak on Sept. 23 in Colwood

Man equipped with bear spray, tools caught in Oak Bay laundry room

Prolific offender arrested after allegedly breaking into apartment building

VIDEO: Liberals make child care pledge, Greens unveil platform on Day 6 of campaign

Green party leader Elizabeth May unveils her party’s platform in Toronto

Free Tesla 3 offered with purchase of Surrey townhome

Century Group’s offer for Viridian development runs through Oct. 31

B.C. communities urged to improve access for disabled people

One in four B.C. residents has disability, most want to work

Sikh millworker lodges human rights complaint against Interfor, again

Mander Sohal, fired from Delta’s Acorn Mill, alleges discrimination based on religion and disability

Safety concerns resurface after fatal bus crash on Vancouver Island

Huu-ay-aht First Nations wants a safe route between Bamfield and Port Alberni

National weather forecasters predict average fall, cold winter

The Weather Network says precipitation will about average in most parts of Canada

Two dead, two in critical condition in highway crash near Campbell River

Highway 19 reopened Sunday night after it was closed in both directions

VIDEO: Vancouver Island mayor details emergency response after fatal bus crash

Sharie Minions says she is ‘appalled’ by condition of road where bus crashed

Scheer makes quick campaign stop in Comox

Conservative leader highlights tax promises early in campaign

Most Read