Air Canada suspends financial forecast for 2019 after Boeing 737 Max grounded

Analyst Walter Spracklin of RBC Dominion Securities advised investors not to be alarmed

Canada’s largest airline is suspending its financial guidance for this year following the decision by regulators in Canada and the United States to ground the Boeing 737 Max aircraft until further notice.

Air Canada said Friday that, “in light of the current uncertainty,” it is suspending the forecast it provided last month for its 2019 financial year.

The Montreal-based company said its guidance for the years 2020 and 2021 for return on invested capital and margin on earnings before interest, taxes, depreciation and amortization (EBITDA), as well as the cumulative free cash flow over the 2019-2021 period, remains in place.

Analyst Walter Spracklin of RBC Dominion Securities advised investors not to be alarmed.

WATCH: Canada bans Boeing 737 Max 8 plane following fatal Ethiopian crash

“We believe the company has avenues to work around the grounding, including the longer in-service use of older aircraft, possible access to third-party aircraft, the temporary use of different gauge aircraft and if necessary the temporary suspension of some routes,” he wrote in a research note.

Spracklin said the carrier’s suspension “does not come as unexpected and more importantly, we do not consider it to be impacting our longer-term view on the shares.”

Regulators around the world grounded the Boeing 737 Max 8 and Max 9 aircraft over safety concerns arising from the crash of an Ethiopian Airlines flight that killed everyone on board, including 18 Canadians.

Concerns have been raised regarding apparent similarities with a Lion Air flight involving the same aircraft that crashed off the Indonesian coast in October.

Air Canada has 24 Boeing 737 Max 8 aircraft out of 184 narrow-body planes in its fleet.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Terrace death not considered suspicious at this time: RCMP

Body of 49-year-old man was found in wooded area near Olson Ave. March 22

Northwest mobile unit to help those at heart of mental health, addiction crisis

Province, Northern Health unveils new unit in Terrace to bridge gaps in services

Move natural gas pipeline, MP suggests

Coastal GasLink could then avoid opposition

Coastal GasLink violates terms of permit

Tree clearing took place outside Kitimat

The good, bad and the unknown of Apple’s new services

The announcements lacked some key details, such as pricing of the TV service

Morneau unveils principles for Indigenous ownership in Trans Mountain pipeline

The controversial pipeline was bought by Ottawa last year

Refugee who sheltered Edward Snowden in Hong Kong arrives in Canada

Vanessa Rodel and her seven-year-old daughter Keana arrived in Toronto this week

New UMSCA trade deal getting a boost from Trump, business groups

The trade deal is designed to supplant the North American Free Trade Agreement

Trudeau says he, Wilson-Raybould had cordial conversation last week

Trudeau denies anything improper occurred regarding SNC-Lavalin and the PMO

SNC-Lavalin backtracks on CEO’s comments surrounding potential job losses

Top boss had said protecting 9,000 jobs should grant leniency

Is it a homicide? B.C. woman dies in hospital, seven months after being shot

Stepfather think Chilliwack case should now be a homicide, but IHIT has not confirmed anything

Indecent caller handed 18-month conditional sentence

Vancouver Island man pleaded guilty to making indecent phone and video calls to women across B.C.

Sources say Trudeau rejected Wilson-Raybould’s conservative pick for high court

Wilson-Raybould said Monday “there was no conflict between the PM and myself”

Most Read