April 6, 2023
NAV CANADA today released its financial results for the three months ended February 28, 2023.
In the second quarter of fiscal 2023, the Company saw air traffic levels, as measured in weighted charging units(1), increase 21.2% on a year over year basis. In comparison to pre-pandemic levels in fiscal 2019 however, weighted charging units were 9.9% lower. The Company’s revenue for the second quarter of fiscal 2023 was $388 million, compared to $313 million over the same period in fiscal 2022.
“Our air traffic levels provide a positive signal on the state of the industry as it continues to recover. NAV CANADA remains focused on supporting a sustained recovery for the industry through strategic and measured investment in world-leading technologies and leveraging innovation in partnership with our customers and stakeholders,” said Raymond G. Bohn, President and CEO. “To do so, we continue to build a strong company culture and a one company mindset that will deliver enhanced resiliency, increased capacity and enhanced long term cost effectiveness.”
The Company had positive free cash flow(2) of $34 million in the second quarter of fiscal 2023 as compared to $28 million in the same period in fiscal 2022. The Company ended the quarter with a cash balance of $411 million.
Operating expenses for the second quarter of fiscal 2023 were $371 million as compared to $350 million over the same period in fiscal 2022 as a result of higher compensation costs and operational expenditures.
Net other income and expenses for the second quarter of fiscal 2023 were a net expense of $20 million as compared to a net expense of $29 million over the same period in fiscal 2022.
The Company had a net loss (before net movement in regulatory deferral accounts including rate stabilization) of $3 million in the second quarter of fiscal 2023 as compared to $66 million for the second quarter of fiscal 2022.
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 second quarter of fiscal 2023 was an expense of $33 million as compared to income of $35 million over the same period in fiscal 2022. This change in regulatory deferrals is primarily due to favourable rate stabilization adjustments of $34 million in the second quarter of fiscal 2023 as compared to unfavourable adjustments of $5 million for the same period in fiscal 2022, along with a $29 million net decrease in adjustments required to align the accounting recognition of certain transactions to the periods in which they will be considered for rate setting. As at February 28, 2023, the rate stabilization account had a balance of $462 million to be recovered from customers through future customer service charges.
The Company’s Financial Statements and Management's Discussion and Analysis for the three and six months ended February 28, 2023 can be found at:
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.
(1) Weighted charging units represent a traffic measure that reflects the number of billable flights, aircraft size and distance flown in Canadian airspace and is the basis for movement-based service charges, which comprise the vast majority of the Company’s revenue.
(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, investments in Aireon LLC and equity related investments and principal payment of lease liabilities. Management places importance on this indicator as it assists in measuring the impact of its investment program on the Company’s financial resources.
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.