HALIFAX - Chorus Aviation beat expectations as its net profit. excluding severance and one-time costs, grew 17.5 per cent to $20.8 million in the fourth quarter.
The Halifax-based regional airline for Air Canada, which has been cutting costs to make itself more competitive, said it ended the year with 17 cents per share in adjusted earnings. That was three cents ahead of analyst forecasts and last year's results.
Including one-time costs, Chorus (TSX:CHR.B) said Thursday that its net income decreased nearly 40 per cent to $8.8 million or seven cents per share.
Operating income increased $32.5 million, up from $25.2 million in the period a year ago.
Operating revenue increased slightly to $413.2 million. Passenger revenue, excluding pass-through costs, increased 2.2 per cent due to rate increases from Air Canada (TSX:AC.B), offset by a decrease in billable block hours.
For the full year, Chorus earned $61.9 million or 50 cents per share, down 38 per cent from $100.2 million or 81 cents per basic share. Adjusted net income was $84.7 million or 69 cents per share, compared to $94.6 million or 76 cents per share in 2012.
Revenues decreased to $1.67 billion from $1.71 billion a year ago.
Chief executive Joseph Randell said the company achieved another profitable year in 2013 after overcoming several challenges, including a successful arbitration battle with Air Canada.
He said the airline, which operates Jazz, is committed to "perfecting" its operating performance while continuing to reduce costs and improve efficiencies.
It paid $9.9 million in severance last year to senior workers who took buyouts, and has earmarked another $15 million in 2014.
Chorus said its billable block hours will be reduced this year to between 368,000 and 378,000 hours. But Walter Spracklin of RBC Capital Markets said that's above his forecast of 365,000, which is a positive indication that demand from Air Canada remains healthy.
On the Toronto Stock Exchange, Chorus shares gained 21 cents, or 5.8 per cent, at $3.80 in Thursday morning trading.