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1. In 2013, Canadian Level I and II air carriers reported 65.5 million enplaned passengers in their scheduled and charter operations, up 0.5% from 2012. The scheduled passenger counts totalled 60.3 million and the charter passenger counts, 5.3 million. The scheduled passenger counts were up 0.8% over 2012, reflecting growth in each of the four quarters. Charter services saw a decline in passengers carried for the first three quarters, before experiencing a rebound in the fourth quarter, with the annual total down by 3.0% over 2012. In 2013, these carriers recorded 154.4 billion passenger-kilometres flown in their scheduled and charter operations, down slightly from 155.0 billion in 2012.
2. These same carriers reported a slight decline in their scheduled passenger load factor (a measure of the fullness of their aircraft) compared to the previous year. The load factor decreased from 82.9% in 2012 to 82.5% in 2013, as the demand for travel, as measured by passenger-kilometres, grew at a slightly slower rate (+0.2%) than the supply (capacity), as measured by available seat-kilometres (+0.7%). After decreasing in the first two quarters of 2013, breaking the upward trend that began in the fourth quarter of 2009, capacity increased again in the final two quarters of 2013.
3. The total operating revenues generated by Level I and II carriers in 2013 reached $19.4 billion, up 1.5% (+$0.3 billion) from 2012. Passenger revenues accounted for 89.7% of total operating revenues in 2013, up from 89.5% the year before. The growth in operating revenues can be tied mainly to a yield (passenger revenues per passenger-kilometre) increase of 2.2%, aided by growth in the Canadian economy and in the airline industry. Another factor in the yield improvement was the favourable impact of a weaker Canadian dollar on foreign currency denominated passenger revenues. Conversely, the unfavourable impact of a weaker Canadian dollar on foreign currency denominated operating expenses (mainly U.S. dollars), when compared to 2012, pushed up the total operating expenses by 0.6% (+$0.1 billion) to $18.2 billion in 2013. This rise was also led by airline capacity growth and increased wages and salaries paid, but was offset somewhat by a decline in fuel prices. These carriers reported an operating income of $1.2 billion in 2013, up from $1.1 billion the prior year.
4. Reported net income declined to $494.6 million in 2013 from $738.7 million in 2012. This decrease, which was driven by higher non-operating expenses in each quarter of 2013, occurred despite the fact that operating revenues increased at a faster pace than did operating expenses for 2013 as a whole.
5. From the first quarter of 2013 to the fourth quarter of 2013, the operating ratio (which reflects a carrier's ability to meet its short-term obligations and represents the proportion of operating revenue absorbed by operating expenses) ranged between 0.88 in the third quarter and 1.00 in the first quarter. Overall, this means that the carriers earned 12.0 cents of profit for every dollar spent in the third quarter of 2013 and no profit in the first quarter. An operating ratio greater than 1.00 would indicate that these carriers experienced an operating loss.
6. For the four quarters of 2013, the highest profit margin (10.1%) was recorded in the third quarter. The profit margin represents the profit earned per revenue dollar and is obtained by dividing net income by operating revenue, with this ratio being expressed as a percentage. The negative profit margin for the first quarter (-3.9%) reflected increases in both operating expenses (primarily salaries and wages, which grew by 5.4% over the same quarter a year ago) and non-operating expenses. This quarter was also the only one in 2013 where carriers reported a decline in total operating revenues compared to the previous year. While the third quarter produced the highest profit margin in 2013, the level dropped from 13.4% in 2012, owing to increases in both operating and non-operating expenses, which outpaced the growth in operating revenues.
7. In 2013, operating revenue per employee varied from $92,209 in the fourth quarter to $108,606 in the third quarter. This employee productivity measure showed declines of 2.2% and 2.4% respectively, in the first two quarters, followed by increases of 1.9% in the third quarter and 3.6% in the final quarter. Another method of assessing productivity in the aviation industry is to calculate tonne-kilometres flown per employee. According to this measure, labour productivity in 2013 was lower than that of 2012 in all quarters except for the fourth. The changes ranged from a decline of 4.6% in the second quarter to an increase of 2.7% in the fourth quarter. As in the previous year, the tonne-kilometres flown per employee were highest in the third quarter, at 99,132.
8. Total employment reported by Canadian Level I and II air carriers rose in each of the first three quarters of 2013 compared to the previous year, with the gains ranging from 1.1% in the third quarter to 3.0% in the second quarter, before declining by 0.7% in the fourth quarter. The string of quarterly year-over-year increases in total wages and salaries paid that began in the fourth quarter of 2005 continued in each quarter of 2013 until it ended with a decline in the fourth quarter. Overall, the total amount paid in wages and salaries in 2013 rose 3.2% to $3.4 billion.