Fiscal year highlights:
Revenues of $3,398.5 million, up 3.5% from $3,283.8 million for fiscal 2024
Adjusted EBITDA1 of $271.0 million, compared to $203.2 million last year
Net income of $241.9 million ($6.06 per share), compared to a net loss of $114.0 million ($2.94 per share) in 2024
Negative free cash flow1 of $45.0 million, compared to negative $122.1 million last year
Elevation Program initiatives are expected to contribute $100M in adjusted EBITDA1 by mid-2026, in line with the objective
Conclusion of the LEEFF debt restructuring, reducing the amount owed under the program from $762.2 million as of the second-quarter to $350.0 million as at October 31, 2025
Fourth-quarter highlights:
Revenues of $771.6 million, down 2.2% from $788.8 million last year
Adjusted EBITDA1 of $71.4 million, compared to $128.4 million last year
Net loss of $12.5 million ($0.31 per share), versus net income of $41.2 million ($1.05 per share) last year
Negative free cash flow1 of $194.2 million, compared to negative $102.2 million last year
Cash and cash equivalents of $164.9 million as at October 31, 2025
MONTRÉAL, Dec. 18, 2025 /CNW/ - Transat A.T. Inc. today reported its fourth quarter 2025 financial results.
"Transat posted all-time record adjusted EBITDA in fiscal 2025. Operationally, we established key building blocks to generate growth momentum through the deployment of high-potential routes, the rigorous execution of our Elevation Program, and the refinancing of our government debt. As for financial performance, adjusted EBITDA grew 33% to $271 million on revenues of $3.4 billion, despite a volatile macro-economic environment and persistent Pratt & Whitney engine issues. As expected, fourth quarter revenues declined slightly as substantially lower year-end compensation from Pratt & Whitney overshadowed underlying revenue growth driven by higher yields. We have delivered on the objectives set for fiscal 2025 and continue to make progress toward the full execution of our business plan. Finally, the tentative agreement reached with our pilots' union allows us to focus on meeting solid customer demand for leisure travel. In addition, all collective agreements that had expired since 2023 have now been successfully renegotiated for a period extending at least through 2027," said Annick Guérard, President and Chief Executive Officer of Transat.
"We are optimistic about accelerating our growth trajectory in 2026. Targeted network expansion across destinations in Africa, Europe and South America, combined with fewer grounded aircraft and network optimization, should result in increased capacity for 2026. In addition, we expect to derive the full impact from our Elevation Program through revamped cost and revenue management practices," added Ms. Guérard.
"In terms of profitability, despite the impact of certain unfavorable provisions in the fourth-quarter, Transat still delivered solid adjusted EBITDA growth for the year. On the refinancing front, the successful restructuring of our government debt proved to be a key milestone in 2025. This significant debt reduction enables us to pursue growth initiatives and complete the implementation of our optimization program. On top of these benefits, interest expenses will decrease substantially in the upcoming year while debt maturity dates have been extended until 2035. Ultimately, we can now focus on executing our strategy to create long-term value for our shareholders," said Jean-François Pruneau, Chief Financial Officer of Transat.
Fiscal year results
For the year ended October 31, 2025, revenues reached $3,398.5 million, up 3.5% from $3,283.8 million in the corresponding period a year ago. The variation is attributable to a 2.3% increase in yield and a 0.2% increase in traffic. Network-wide capacity increased by 0.8% compared to the same period in 2024.
For the year, adjusted EBITDA1 totaled $271.0 million, compared with $203.2 million for fiscal 2024. The increase was mainly attributable to revenue growth, productivity gains and lower fuel prices by 9.8%, compared with fiscal 2024.
Fourth-quarter results
For the quarter ended October 31, 2025, revenues reached $771.6 million, down 2.2% from $788.8 million in the corresponding period last year. This decrease was attributable to the financial compensation received from the original equipment manufacturer of the GTF2 engines that was $28.2 million lower than in the fourth quarter of 2024. Excluding the impact of this lower compensation, revenues increased by 1.5%. Traffic, expressed in revenue-passenger-miles (RPM), decreased by 2.0%, resulting from a capacity reduction of 1.8% compared to the corresponding period last year. These factors were partially offset by a 3.3% increase in airline unit revenues (yield).
Adjusted EBITDA1 amounted to $71.4 million, compared with $128.4 million in 2024. This variation resulted from lower revenues, as well as from higher aircraft maintenance costs and salaries and employee benefits.
Cash flow and financial position
Cash flows related to operating activities used $114.5 million during the fourth quarter of 2025, compared with a cash usage of $108.1 million for the same period last year, as lower profitability was partially offset by an increase in non-cash working capital balances. For the 2025 fiscal year, cash flows related to operating activities generated $157.0 million, compared to a cash generation of $94.7 million in fiscal 2024.
After accounting for investing activities and repayment of lease liabilities, free cash flow1 was negative $194.2 million during the quarter, compared with negative $102.2 million for the corresponding period last year. The difference primarily reflects that, during the same quarter last year, the company entered into sale-leaseback transactions involving three Pratt & Whitney GTF2 engines for a total of $92.1 million. For fiscal 2025, free cash flow1 was negative $45.0 million, compared to negative $122.1 million in fiscal 2024.
As at October 31, 2025, cash and cash equivalents stood at $164.9 million, compared to $260.3 million as at October 31, 2024. Cash and cash equivalents in trust or otherwise reserved mainly resulting from travel package bookings totaled $465.6 million as at October 31, 2025, compared with $484.9 million as at October 31, 2024. Customers deposits for future travel totaled $823.3 million as at October 31, 2025, compared to $781.2 million as at October 31, 2024.
Long-term debt and deferred government grant totaled $400.0 million as at October 31, 2025, compared to $803.1 million as at October 31, 2024. This decrease is mainly attributable to the reduction in long-term debt following the Corporation's debt restructuring, including the full repayment of the $41.4 million principal balance of the secured LEEFF financing. During fiscal 2025, the Corporation also made a $13.7 million mandatory principal prepayment on its Unsecured debenture – LEEFF and redeemed 6,243,026 Series 4 Preferred Shares for $16.3 million. The Corporation drew down $30.0 million under its Subordinated working capital facility – LEEFF.
Reflecting these transactions, the long-term debt and deferred government grant net of cash and cash equivalents stood at $235.1 million, down from $542.7 million as at October 31, 2024.
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2 Geared turbofan ("GTF ")
Key indicators
To date, airline unit revenues, expressed as yield, for Winter 2026 are 1.4% higher compared to the same date in fiscal 2025, while load factors are 0.8 percentage points lower than they were at this time last year, mainly influenced by second-quarter dynamics, with potential for improvement as the season progresses.
For fiscal year 2026, the Corporation expects a 6% to 8% increase in capacity, measured in available seat-miles, compared to 2025.
Conference call
The fourth quarter 2025 conference call will take place on Thursday, December 18, 2025, 10:00 a.m. To join the conference call without operator assistance, you may register by entering your phone number here to receive an instant automated call back.
You can also dial direct to be entered into the call by an operator:Montreal: 514 400-3794North America (toll-free): 1 800 990-4777Name of conference: Transat The conference will also be accessible live via webcast: click here to register.
An audio replay will be available until December 25, 2025, by dialing 1 888 660-6345 (toll-free in North America), access code 02859 followed by the pound key (#). The webcast will remain available for 90 days following the call.
First-quarter 2026 results will be announced on March 10, 2026.
(1) Non-IFRS financial measures
Transat prepares its financial statements in accordance with International Financial Reporting Standards ["IFRS"]. We will occasionally refer to non-IFRS financial measures in the news release. These non-IFRS financial measures do not have any meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. They are intended to provide additional information and should not be considered as a substitute for measures of performance prepared in accordance with IFRS. All dollar figures are in Canadian dollars unless otherwise indicated.
The following are non-IFRS financial measures used by management as indicators to evaluate ongoing and recurring ...
