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1. In 2014, Canadian Level I and II air carriers reported 69.6 million enplaned passengers in their scheduled and charter operations, up 6.1% from 2013. The scheduled passenger counts totalled 63.6 million and the charter passenger counts, 6.0 million. Both scheduled (+5.6%) and charter (+11.9%) services saw a growth in passengers carried over 2013, reflecting increases in each of the four quarters. The scheduled passenger counts reached 17.9 million in the third quarter of 2014, the highest number ever recorded for a quarter, surpassing the 16.6 million reported in the same quarter of 2013.
2. In 2014, these carriers recorded 166.2 billion passenger-kilometres flown in their scheduled and charter operations, up 7.6% from the previous year. Scheduled services accounted for over 90% of the demand for travel, as measured by passenger-kilometres.
3. These same carriers reported a slight improvement in their scheduled passenger load factor (a measure of the fullness of their aircraft) compared to 2013. The load factor increased from 82.5% in 2013 to 82.7% in 2014, as the demand for travel, as measured by passenger-kilometres, advanced at a slightly faster pace (+7.5%) than the supply (capacity), as measured by available seat-kilometres (+7.4%). In 2014, these carriers recorded their highest passenger load factor on scheduled flights in the third quarter (86.1%), largely due to a stronger increase in demand than in capacity; in the same quarter in 2013, it had reached 85.7%.
4. Total operating revenues in 2014 reached $20.9 billion, up 7.5% (+$1.5 billion) from 2013, reflecting growth in each of the four quarters. Passenger revenues accounted for 89.3% of total operating revenues, down from 89.8% the year before. The increase in operating revenues was mainly due to traffic growth of 7.6% partly offset by a yield (passenger revenues per passenger-kilometre) decline of 0.6%. An increase in average passenger trip length of 1.5% over 2013, reflecting international long-haul growth, had the effect of reducing yield by 0.6%.
5. In 2014, total operating expenses amounted to $19.3 billion, up 6.4% (+$1.2 billion) from the previous year, primarily driven by the capacity growth and the unfavourable impact of a weaker Canadian dollar on foreign currency denominated operating expenses (mainly U.S. dollars). Higher fuel prices and increased wages and salaries paid also contributed.
6. Canadian Level I and II air carriers reported net operating income of $1.5 billion in 2014, up from $1.2 billion the previous year following year-over-year increases in all but the fourth quarter.
7. Net income (net operating income plus net non-operating income) rose 29.6% to $633.1 million in 2014 from $488.4 million in 2013, marking the third increase in five years. This followed a 33.9% decline in 2013.This improvement in profitability was largely accounted for by the increase in net operating income of $326.4 million in the second and third quarters of 2014 combined. However, the rise in net non-operating loss from $746.6 million in 2013 to $902.5 million in 2014 dampened the increase in net income.
8. From the first quarter of 2014 to the fourth quarter of 2014, 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 0.85 in the third quarter and 0.99 in the first quarter. Overall, this means that the carriers earned 15.0 cents of profit for every dollar spent in the third quarter of 2014 and 1.0 cent of profit in the first quarter. An operating ratio greater than 1.00 would indicate that these carriers experienced an operating loss.
9. For the four quarters of 2014, the highest profit margin (9.8%) 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. In other words, every dollar of service sold in the third quarter earned 9.8 cents of profit for the carriers. The negative profit margin for the first quarter (-5.6%) reflected increases in both operating expenses and non-operating expenses, which outpaced the growth in operating revenues. While the third quarter produced the highest profit margin in 2014, the most notable increase occurred in the second quarter (from +1.4% in 2013 to +6.7% in 2014), owing to a 90.2% drop in non-operating expenses.
10. In 2014, operating revenue per employee varied from $99,188 in the fourth quarter to $119,549 in the third quarter. This employee productivity measure showed year-over-year increases from 2013 to 2014 for all four quarters, with the gains ranging from 4.5% in the first quarter to 10.1% in the third 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 2014 bettered the previous level in each of the four quarters. The increases ranged from 3.7% in the first quarter to 9.3% in the third quarter. As in the previous year, the tonne-kilometres flown per employee were highest in the third quarter, at 108,364.
11. Total employment reported by Canadian Level I and II air carriers edged down in each of the first three quarters of 2014 compared to the previous year, with the declines ranging from 0.2% in the third quarter to 0.6% in the second quarter, before rising by 0.4% 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 (except for the fourth quarter of 2013) continued in each quarter of 2014. Increases ranged from 1.2% in the second quarter to 5.1% in the fourth quarter. Overall, the total amount paid in wages and salaries in 2014 rose 2.7% to $3.5 billion.