Subject: EARNINGS
NAV CANADA announces first quarter financial results
OTTAWA, Jan. 09, 2019 (GLOBE NEWSWIRE) -- NAV CANADA today released its financial results for the three months ended November 30, 2018.
In the first quarter of fiscal 2019, NAV CANADA experienced positive financial performance as evidenced by its rate stabilization account balance of $128 million(1) which reflected a planned reduction of $5 million from August 31, 2018, but still grew by $4 million in the quarter. The Company had positive free cash flow(2) of $6 million and ended the quarter with cash of $44 million.
The Company's revenue for the first quarter of fiscal 2019 was $357 million, compared to $347 million over the same period in fiscal 2018, mainly due to a year-to-date 3.5 per cent growth in air traffic volumes. Revenues for the three months ended November 30, 2018 reflect the revised customer service charges, whereby existing base rates decreased by an average of 0.4 per cent on September 1, 2018. This effectively continues the 0.4 per cent one-year temporary rate reduction that was implemented on September 1, 2017.
"Positive financial performance in the first quarter of fiscal 2019 has allowed us to continue to carry on with our planned investments in our technology, facilities and in our people" said Neil Wilson, President and CEO. "We continue our work of implementing innovative technologies that improve the safe operation of Canadian controlled airspace and look forward to going live with space-based surveillance technology in our air traffic control operations for both domestic and North Atlantic oceanic airspace at the end of March 2019."
"We are also delighted that for the third year in a row the Company has obtained a spot on Canada's Top 100 Employers list" said Mr. Wilson. "It reflects our commitment to making NAV CANADA a great place to work and to ensuring we have an engaged workforce."
Operating expenses for the first quarter of fiscal 2019 were $348 million as compared to $340 million over the same period in fiscal 2018, mainly due to higher compensation costs.
Net other income and expenses for the first quarter of fiscal 2019 was a net expense of $17 million as compared to a net expense of $18 million over the same period in fiscal 2018, primarily due to lower net interest costs relating to employee benefits partially offset by lower foreign exchange gains in the first quarter of fiscal 2019.
The Company had a net loss (before net movement in regulatory deferral accounts including rate stabilization) of $8 million in the first quarter of fiscal 2019 as compared to a net loss of $11 million for the first quarter of fiscal 2018.
The Company is subject to legislation that regulates its approach to setting charges. The timing of the recognition of certain revenue and expenses recovered through charges is recorded through movements in regulatory deferral accounts. The net movement in regulatory deferral accounts for the first quarter of fiscal 2019 was income of $6 million as compared to income of $14 million over the same period in fiscal 2018. This change in regulatory deferrals is due to deferrals of higher favourable results through rate stabilization adjustments of $7 million offset by a $1 million net decrease in regulatory deferral adjustments to reflect certain transactions in the periods in which they will be considered for rate setting.
The Company's Financial Statements and Management's Discussion and Analysis for the three months ended November 30, 2018 can be found at:
About NAV CANADA
NAV CANADA is a private, not-for-profit company, established in 1996, providing air traffic control, airport advisory services, weather briefings and aeronautical information services for more than 18 million square kilometres of Canadian domestic and international airspace.
The Company is internationally recognized for its safety record, and technology innovation. Air traffic management systems developed by NAV CANADA are used by air navigation service providers in countries worldwide.
NAV CANADA is a partner of Aireon LLC, an international joint venture deploying a space based Automatic Dependent Surveillance-Broadcast (ADS-B) system that will expand air traffic surveillance to all regions of the globe.
| (1) | A positive balance in the rate stabilization account represents a regulatory credit balance on the Company's statement of financial position, reflecting amounts returnable to customers through future customer service charges. | |
| (2) | Free cash flow is a non-GAAP financial measure used by the Company to enhance the overall understanding of its financial and operating performance. Non-GAAP financial measures do not have any standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers. The Company defines free cash flow as cash generated from operations, less capital expenditures and investments in Aireon LLC and equity related investments. Management places importance on this indicator as it assists in measuring the impact of its investment program on the Company's financial resources. |
For further information, please contact:
Ron Singer
National Manager, Media Relations
(613) 563-7303
Media Information Line: 1-888-562-8226
This press release contains certain forward-looking statements that are subject to important risks and uncertainties. Actual results may differ materially from the results indicated in these statements for a number of reasons. NAV CANADA disclaims any intention to update any forward-looking statements.
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