Chorus Aviation Inc. Announces First Quarter 2026 Financial Results
Stable Cash Flow Profile, Strategic Expansion, Continued Capital Returns
- Net income of
$7.0 million compared to a net income of$18.9 million for Q1 2025. - Adjusted Net Income1 of
$12.6 million compared to$15.4 million for Q1 2025. - Adjusted Net Income per Common Share, basic of
$0.54 compared to$0.57 for Q1 2025. - Adjusted EBITDA of
$44.3 million compared to$56.9 million for Q1 2025. - Free Cash Flow of
$27.0 million compared to$40.6 million for Q1 2025. - Free Cash Flow per Common Share, basic of
$1.16 compared to$1.51 for Q1 2025. - Adjusted Net Debt/Adjusted EBITDA ratio of 1.5 compared to 1.7 at
December 31, 2025 .
"Our first quarter results were in line with expectations, reflecting the stability of our contracted business and consistent execution across the organization," said
"Together with the declaration of our quarterly dividend, ongoing aircraft monetization and continued share repurchases, these actions reflect our disciplined approach to capital allocation and confidence in the long-term strength and cash flow profile of the business," added
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__________________________ |
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1 These are non-GAAP financial measures or non-GAAP ratios that are not recognized measures for financial statement presentation under GAAP. As such, they do not have standardized meanings, may not be comparable to similar measures presented by other issuers and should not be considered a substitute for or superior to GAAP results. Refer to "Non-GAAP Financial Measures" for further information. |
Q1 2026 Financial Highlights
|
(unaudited) (expressed in thousands of Canadian dollars) |
Three months ended |
|||
|
2026 |
2025 |
Change |
Change |
|
|
$ |
$ |
$ |
% |
|
|
|
|
|
|
|
|
Operating revenue |
325,424 |
348,129 |
(22,705) |
(6.5) |
|
Operating expenses |
307,270 |
318,419 |
(11,149) |
(3.5) |
|
|
|
|
|
|
|
Operating income |
18,154 |
29,710 |
(11,556) |
(38.9) |
|
Net interest expense |
(3,333) |
(3,744) |
(411) |
(11.0) |
|
Foreign exchange (loss) gain |
(3,852) |
152 |
(4,004) |
2,634.2 |
|
Gain on property and equipment |
-- |
1 |
(1) |
(100.0) |
|
|
|
|
|
|
|
Income before income tax |
10,969 |
26,119 |
(15,150) |
(58.0) |
|
Income tax expense |
(3,968) |
(7,186) |
3,218 |
(44.8) |
|
|
|
|
|
|
|
Net income |
7,001 |
18,933 |
(11,932) |
(63.0) |
|
|
|
|
|
|
|
Adjusted EBITDA(1) |
44,308 |
56,861 |
(12,553) |
(22.1) |
|
Adjusted EBT(1) |
16,810 |
22,568 |
(5,758) |
(25.5) |
|
Adjusted Net Income(1) |
12,634 |
15,382 |
(2,748) |
(17.9) |
|
(1) |
These are non-GAAP financial measures that are not recognized measures for financial statement presentation under GAAP. As such, they do not have standardized meanings, may not be comparable to similar measures presented by other issuers and should not be considered a substitute for or superior to GAAP results. |
In the first quarter of 2026, Chorus reported Adjusted EBITDA of
- a decrease in aircraft leasing revenue under the CPA of
$5.0 million primarily due to expected changes in lease rates on certain aircraft and a lower US dollar exchange rate; - a contracted decrease in Fixed Margin of
$4.1 million ; - a decrease in Voyageur's parts sales and contract flying; and
- a decrease in capitalization of major maintenance overhauls on owned aircraft of
$2.3 million ; partially offset by - a decrease in general administrative expenses primarily attributable to lower overhead costs.
Adjusted Net Income was
- a
$12.6 million decrease in Adjusted EBITDA as previously described; partially offset by - a positive change in foreign exchange of
$4.6 million ; - a decrease of
$3.0 million in income tax expense; - a decrease in depreciation expense of
$1.8 million primarily attributable to the sale of certain aircraft; and - a decrease in net interest costs of
$0.4 million primarily related to the repayment of the Series B Debentures and the partial repurchase of the Series C Debentures in the first quarter of 2025; offset by lower interest revenue.
Net income was
- the previously noted decrease in Adjusted Net Income of
$2.7 million ; - a negative change in net unrealized foreign exchange of
$8.6 million ; and - an increase in strategic advisory fees of
$0.8 million ; partially offset by - a decrease in income tax, including tax on adjusted items of
$0.2 million .
Completed KADEX Acquisition
On
Progressed Aircraft Sales
In 2025, Chorus executed agreements to sell nine Dash 8-400s as they exit the fleet in accordance with the CPA for estimated net proceeds of US
Continued Share Buybacks
On
Dividend Declaration
Chorus has announced the declaration of a cash dividend of
This dividend is an eligible dividend in
Outlook1
The table below presents Chorus' outlook for 2026, including projections for Adjusted EBITDA, Free Cash Flow, repayment of Amortizing Term Loans, Free Cash Flow after repayment of Amortizing Term Loans and key metrics related to aircraft leasing under the CPA. Under the CPA, Jazz receives a Fixed Margin that does not vary with flying levels; accordingly, any variations in flying are not expected to have any impact on Jazz's earnings. In addition, Jazz receives compensation for aircraft leased under the CPA which generates predictable Free Cash Flows. The associated amortizing debt will be fully repaid by the end of the original lease term. At the end of each lease, Jazz will either extend the lease, sell or part-out each aircraft. If leases are extended, subsequent leases are expected to continue to generate predictable Free Cash Flow at lower rates, however these aircraft will be unencumbered.
|
(unaudited) (in thousands of Canadian dollars) |
Annual Forecast (1) |
|
|
2026 $ |
||
|
|
From |
To |
|
Adjusted EBITDA(2)(3) |
170,000 |
185,000 |
|
Free Cash Flow(2)(3) |
100,000 |
110,000 |
|
Repayment of Amortizing Term Loans(4) |
(64,000) |
(64,000) |
|
Free Cash Flow after repayment of Amortizing Term Loans(2)(3)(4) |
36,000 |
46,000 |
|
|
|
|
|
|
|
|
|
Fixed Margin(5) |
43,900 |
43,900 |
|
Aircraft leasing revenue under the CPA |
104,000 |
105,000 |
|
Wholly-owned aircraft leased under the CPA (end of period) |
39 |
39 |
|
Wholly-owned aircraft leased under the CPA available for sale(6) |
5 |
5 |
|
(1) |
The forecast uses a foreign exchange rate of 1.3500. |
|
(2) |
These are non-GAAP financial measures that are not recognized measures for financial statement presentation under GAAP. As such, they do not have standardized meanings, may not be comparable to similar measures presented by other issuers and should not be considered a substitute for or superior to GAAP results. |
|
(3) |
The forecast is based on projected earnings under existing contracts and future market lease rates. The forecast also includes the impact of the KADEX acquisition. |
|
(4) |
Scheduled debt payments are based on current debt repayments schedule for aircraft leased under the CPA and the |
|
(5) |
The Fixed Margin will be |
|
(6) |
During 2025, Chorus entered into agreements to sell nine aircraft. Chorus sold four aircraft as follows: one in |
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________________________ |
Portfolio of
- Current fleet of 45 wholly-owned aircraft and five spare engines
- Current net book value of
$686.9 million - Future contracted lease revenue US
$280.4 million 2,3 - Current weighted average fleet age of 9.5 years4
- Current weighted average remaining lease term of 3.8 years
- Long-term debt of
$251.0 million (US$180.1 million ) - 100% of debt has a fixed rate of interest
- Current weighted average cost of borrowing of 3.28%
|
1 |
As at |
|
2 |
See cautionary statement regarding forward-looking information below. |
|
3 |
The estimates are based on agreed lease rates in the CPA. |
|
4 |
Fleet age and remaining lease term is calculated based on the weighted average of the aircraft net book value. |
Jazz continues to progress through the extensive cabin refurbishment program for aircraft operated under the Air Canada Express brand. This refurbishment program includes upgraded Wi-Fi connectivity, larger overhead storage bins, new lightweight seats, in-seat power supply, and refreshed cabin interiors for the E-175s and CRJ900s. In addition, a select number of Dash 8-400s are in the process of receiving Wi-Fi connectivity for
Capital Expenditures
Capital expenditures in 2026 are expected to be as follows:
|
(unaudited) (in thousands of Canadian dollars) |
Annual Forecast 2026 $ |
||
|
Capital expenditures, excluding aircraft acquisitions |
24,000 |
to |
29,000 |
|
Capitalized major maintenance overhauls(1) |
3,000 |
to |
8,000 |
|
Aircraft acquisitions and improvements |
9,500 |
to |
14,500 |
|
|
36,500 |
to |
51,500 |
|
(1) |
The 2026 plan includes between |
Use of Defined Terms
Capitalized terms used but not defined in this news release have the meanings given to them in management's discussion and analysis of results of operations and financial condition dated
Investor Conference Call / Audio Webcast
Chorus will hold an analyst call at
This is a listen-in only audio webcast.
The conference call webcast will be archived on Chorus' website at www.chorusaviation.com under Investors > Reports. A playback of the call can also be accessed until
NON-GAAP FINANCIAL MEASURES
This news release references several non-GAAP financial measures and ratios to supplement the analysis of Chorus' results. Chorus uses these non-GAAP measures to evaluate and assess performance. These non-GAAP measures are generally numerical measures of Chorus' financial performance, financial position, or cash flows, that include or exclude amounts from the most comparable GAAP measure. As such, these measures are not recognized for financial statement presentation under GAAP, do not have standardized meanings, may not be comparable to similar measures presented by other entities, and should not be considered a substitute for or superior to GAAP results. For further information on non-GAAP measures used in this news release, please refer to Section 17 (Non-GAAP Financial Measures) of the MD&A, which is available on Chorus' website (www.chorusaviation.com) and under Chorus' profile on SEDAR+ (www.sedarplus.ca). Reconciliations of non-GAAP measures to their nearest GAAP measures are provided below.
Adjusted Net Income, Adjusted EBT, Adjusted EBITDA
|
(unaudited) (expressed in thousands of Canadian dollars except per Share amounts) |
Three months ended |
||
|
2026 $ |
2025 $ |
Change $ |
|
|
|
|
|
|
|
Net income |
7,001 |
18,933 |
(11,932) |
|
Add (Deduct) items to get to Adjusted Net Income |
|
|
|
|
Strategic advisory fees(1) |
772 |
-- |
772 |
|
Unrealized foreign exchange loss (gain) |
5,069 |
(3,551) |
8,620 |
|
Income tax, including on adjusted items |
(208) |
-- |
(208) |
|
|
5,633 |
(3,551) |
9,184 |
|
Adjusted Net Income |
12,634 |
15,382 |
(2,748) |
|
Weighted average number of Common Shares (in thousands) |
23,371 |
26,853 |
(3,482) |
|
Adjusted Net Income per Common Share - basic |
0.54 |
0.57 |
(0.03) |
|
Add (Deduct) items to get to Adjusted EBT |
|
|
|
|
Income tax expense |
3,968 |
7,186 |
(3,218) |
|
Income tax, including on adjusted items |
208 |
-- |
208 |
|
Adjusted EBT |
16,810 |
22,568 |
(5,758) |
|
Add (Deduct) items to get to Adjusted EBITDA |
|
|
|
|
Net interest expense |
3,333 |
3,744 |
(411) |
|
Depreciation and amortization excluding impairment |
25,382 |
27,151 |
(1,769) |
|
Foreign exchange (gain) loss |
(1,217) |
3,399 |
(4,616) |
|
Gain on disposal of property and equipment |
-- |
(1) |
1 |
|
|
27,498 |
34,293 |
(6,795) |
|
Adjusted EBITDA |
44,308 |
56,861 |
(12,553) |
|
(1) |
Included in operating expenses. |
Leverage Ratio
Leverage Ratio is used by Chorus as a means to measure financial leverage. Leverage Ratio is calculated by dividing Net debt by trailing 12-month Adjusted EBITDA. Management believes Leverage Ratio to be a useful ratio when monitoring and managing debt levels. In addition, as leverage is a measure frequently analyzed for public companies, Chorus has calculated the amount to assist readers in this review. Leverage Ratio should not be construed as a measure of cash flows. Net debt is a key component of capital management for Chorus and provides management with a measure of its net indebtedness.
|
(unaudited) (expressed in thousands of Canadian dollars) |
|
|
Change |
|
$ |
$ |
$ |
|
|
|
|
|
|
|
Long-term debt and lease liabilities (including current portion) |
383,421 |
374,156 |
9,265 |
|
Less: |
|
|
|
|
Cash |
(98,032) |
(28,656) |
(69,376) |
|
Adjusted Net Debt |
285,389 |
345,500 |
(60,111) |
|
Adjusted EBITDA |
194,330 |
206,883 |
(12,553) |
|
Leverage Ratio |
1.5 |
1.7 |
(0.2) |
Free Cash Flow
Free Cash Flow and Free Cash Flow after repayment of Amortizing Term Loans is a non-GAAP measure used as an indicator of financial strength and performance. Chorus believes that this measurement is useful as an indicator of its ability to service its debt, meet other ongoing obligations and reinvest in the Corporation and return capital to Common Shareholders. Readers are cautioned that Free Cash Flow does not represent residual cash flow available for discretionary expenditures.
Free Cash Flow is defined as cash provided by operating activities less net changes in non-cash balances related to operations and capital expenditures excluding aircraft acquisitions and improvements.
Free Cash Flow after repayment of Amortizing Term Loans is defined as Free Cash Flow, as described above, less repayments on Amortizing Term Loans which excludes payments on the Operating Credit Facility and the Series C Debentures.
The following table provides a reconciliation of Free Cash Flow to cash flows from operating activities, which is the most comparable financial measure calculated and presented in accordance with GAAP:
|
(unaudited) (expressed in thousands of Canadian dollars, except per Share amounts) |
Three months ended |
||
|
2026 |
2025 |
Change |
|
|
$ |
$ |
$ |
|
|
|
|
|
|
|
Cash provided by (used in) operating activities |
63,577 |
(22,514) |
86,091 |
|
Add (Deduct) |
|
|
|
|
Net changes in non-cash balances related to operations |
(30,786) |
69,457 |
(100,243) |
|
Capital expenditures, excluding aircraft acquisitions |
(4,985) |
(3,171) |
(1,814) |
|
Capitalized major maintenance overhauls |
(760) |
(3,218) |
2,458 |
|
Free Cash Flow |
27,046 |
40,554 |
(13,508) |
|
Free Cash Flow per Common Share, basic |
1.16 |
1.51 |
(0.35) |
|
|
|
|
|
|
Repayment of Amortizing Term Loans |
(14,492) |
(22,881) |
8,389 |
|
Free Cash Flow after repayment of Amortizing Term Loans |
12,554 |
17,673 |
(5,119) |
|
Free Cash Flow after repayment of Amortizing Term Loans per Common Share, basic |
0.54 |
0.66 |
(0.12) |
Adjusted Return on Equity
Adjusted Return on Equity is a non-GAAP financial measure used to gauge a corporation's profitability and how efficient it is in generating profits. Adjusted Return on Equity is calculated based on Chorus' Adjusted Net Income, divided by Average Shareholders' equity and cash.
|
(unaudited) (expressed in thousands of Canadian dollars) |
Trailing 12-months ended |
||
|
|
|
|
|
|
2026 |
2025 |
Change |
|
|
$ |
$ |
$ |
|
|
|
|
|
|
|
Adjusted Net Income |
55,887 |
58,635 |
(2,748) |
|
|
|
|
|
|
Average equity excluding cash |
|
|
|
|
Average Shareholders' equity |
507,708 |
509,893 |
(2,185) |
|
Add (Deduct) items to get to average equity excluding cash |
|
|
|
|
Average Cash(1) |
(86,192) |
(125,436) |
39,244 |
|
|
421,516 |
384,457 |
37,059 |
|
Adjusted Return on Equity |
13.3 % |
15.3 % |
(2.0) % |
|
(1) |
Average cash for |
Forward-Looking Information
This news release includes forward-looking information and statements within the meaning of applicable securities laws (collectively, "forward-looking information"). Forward-looking information is identified by the use of terms and phrases such as "aims", "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "potential", "predict", "project", "will", "would", and similar terms and phrases, including negative versions thereof. All information and statements other than statements of historical fact are forward-looking and by their nature, are based on various underlying assumptions and expectations, that Chorus believes are reasonable but that are subject to known and unknown risks, uncertainties and other factors that may cause actual future results, performance or achievements to differ materially from those indicated in the forward-looking information. As a result, there can be no assurance that the forward-looking information included in this news release will prove to be accurate or correct.
Examples of forward-looking information in this news release include the discussion in the Outlook section and statements regarding Chorus' future performance and growth opportunities, including organic and through acquisitions, and the anticipated completion of planned acquisitions and the expected benefits following such acquisitions, planned aircraft sales, Chorus' expectations to return capital to Common Shareholders, including through up to
Actual results may differ materially from those anticipated in forward-looking information for a number of reasons including: changes in the aviation industry and general economic conditions; the emergence of disputes with contractual counterparties (including under the CPA); a deterioration in Air Canada's financial condition; expectations regarding profitability and reimbursement of costs under the CPA. Chorus' inability to realize potential growth opportunities; any default by Chorus under debt covenants; asset impairments; changes in law; litigation; the imposition of tariffs on Canadian exports or imports or adverse changes to existing trade agreements and/or relationships; and the risk factors in Chorus' Annual Information Form dated
The forward-looking information contained in this news release represents Chorus' expectations as of the date of this news release (or as of the date they are otherwise stated to be made) and is subject to change after such date. Chorus disclaims any intention or obligation to update or revise any forward-looking information as a result of new information, subsequent events or otherwise, except as required by applicable securities laws. Readers are cautioned that the foregoing factors and risks are not exhaustive.
About
Chorus is a holding company which owns the following principal operating subsidiaries:
Chorus Class A Variable Voting Shares and Class B Voting Shares trade on the
SOURCE
