Q2 2023 Financial Highlights
- Net income of $20.3 million, a
quarter-over-quarter increase of $60.7
million.
- Adjusted earnings available to Common Shareholders of
$15.5 million, a decrease of
$6.2 million
quarter-over-quarter.
- Adjusted earnings available to Common Shareholders of
$0.08 per Common Share, basic, a
decrease of $0.03
quarter-over-quarter.
- Adjusted EBITDA of $110.7
million, an increase of $5.9
million quarter-over-quarter.
- Free Cash Flow of $70.3 million,
an increase of $36.0 million or
approximately 105.0%.
- Leverage Ratio improved to 3.8 at June
30, 2023 from 4.4 at December 31,
2022.
HALIFAX,
NS, Aug. 3, 2023 /CNW/ - Chorus Aviation Inc.
('Chorus') (TSX: CHR) today announced second quarter 2023 financial
results.
"I am pleased to report Chorus' solid financial performance for
the quarter, delivering improvements in Leverage Ratio and Free
Cash Flow. Free Cash Flow has more than doubled year-over-year to
$70.3 million, and our Leverage Ratio
has improved to 3.8 at June 30, 2023,
from 4.4 at December 31, 2022.
As a result of our contractual earnings, we are on track to meet
our guidance for 2023," said Colin
Copp, President and Chief Executive Officer, Chorus.
"We continue to have productive and advancing discussions on
Fund III with our existing lead investors in Fund II and others.
Due to market conditions over the past year, several of the larger,
existing U.S.-based investors in Fund II have been limited from
making certain investments due to regulatory limits on the
composition of their portfolios. We have recently been informed
that certain states have amended their regulatory limits,
facilitating our discussions with potential investors," stated Mr.
Copp.
"The market for regional aviation remains strong. In the
second quarter, Falko had 20 aircraft transactions with nine
distinct airline customers across six continents. In addition, as
of June 2023, regional current market
values and lease rates have shown signs of recovery from pandemic
lows, reflecting a positive forward outlook," noted Mr. Copp. "We
continue to see many opportunities to deploy funds in regional
aircraft leasing to earn strong mid-teen returns and look forward
to providing an update upon concluding discussions with our
investors."
"Capacity in our Jazz operation is currently constrained as the
strong industry wide demand for pilots continues. Over the past
year, more than 300 pilots have transferred to Air Canada through
our pilot flow agreement in addition to attrition to other
airlines," Mr. Copp continued. "In the same period, we have
successfully recruited and trained over 300 pilots and are
collaborating with Air Canada to explore ways to increase flying
capacity under the CPA. We continue to see a good supply of new
hire pilots and are growing our pipeline of future pilots through
our Jazz Pathways Program and our new flight training academy
Cygnet Aviation."
Second Quarter Summary
In the second quarter of 2023, Chorus reported Adjusted EBITDA
of $110.7 million, an increase of
$5.9 million over the second quarter
of 2022.
The RAL segment's Adjusted EBITDA was $57.3 million, an increase of $6.8 million primarily due to three months of
Falko's earnings in the second quarter of 2023 versus two months in
the second quarter of 2022 partially offset by decreased revenue
related to the sale of wholly-owned aircraft in the second half of
2022.
The RAS segment's Adjusted EBITDA was $61.8 million and was in-line with the second
quarter of 2022. Second quarter results were impacted by:
- an increase in aircraft leasing revenue under the CPA of
$1.5 million primarily due to a
higher US dollar exchange rate; and
- an increase in other revenue of $1.3
million due to an increase in parts sales, MRO activity and
contract flying; offset by
- a contracted decrease in Fixed Margin of $0.8 million;
- a decrease in capitalization of major maintenance overhauls on
owned aircraft of $0.8 million;
and
- an increase in general administrative expenses attributable to
increased operations.
Corporate Adjusted EBITDA of $(8.4)
million was higher than the second quarter of 2022 by
$0.9 million due to:
- an increase in general administrative expenses related to
higher professional fees, salaries, wages and benefits and travel
expenses; partially offset by
- a decrease in stock-based compensation of $1.1 million due to a decrease in the Common
Share price, offset by the change in fair value of the Total Return
Swap.
Adjusted net income was $25.6
million for the quarter, a decrease of $2.0 million over the second quarter of 2022 due
to:
- an increase in depreciation expense of $4.4 million primarily attributable to Falko and
capital expenditures in 2022;
- an increase of $2.9 million in
income tax expense; and
- a change in net foreign exchange of $2.7
million; partially offset by
- a $5.9 million increase in
Adjusted EBITDA as previously described;
- a decrease in net interest costs of $1.5
million primarily related to the redemption of the 6.00%
Debentures in December 2022 and the
recognition of income related to the discontinuance of hedge
accounting on an interest rate swap; partially offset by interest
on long-term debt assumed as part of the Falko Acquisition and the
draw on the Operating Credit Facility; and
- a change on fair value of investments of $0.8 million.
Net income increased $60.7 million
over the second quarter of 2022 primarily due to:
- a change in net unrealized foreign exchange of $27.9 million;
- a decrease in impairment provisions of $20.5 million;
- a decrease in lease repossession costs of $10.7 million;
- a decrease in restructuring expected credit loss provision of
$10.4 million; and
- a decrease in strategic advisory fees of $5.7 million; partially offset by
- the previously noted decrease in Adjusted net income of
$2.0 million; and
- an increase in income tax expense on adjusted items of
$12.8 million.
Year-to-Date Summary
Chorus reported Adjusted EBITDA of $228.8
million for 2023, an increase of $40.7 million over the same prior year
period.
The RAL segment's Adjusted EBITDA was $118.9 million, an increase of $36.7 million primarily due to six months of
Falko's earnings versus two months in the first half of 2022;
partially offset by decreased revenue related to the sale of
aircraft in the second half of 2022.
The RAS segment's Adjusted EBITDA was $125.7 million, an increase of $6.4 million due to:
- an increase in other revenue of $8.0
million due to an increase in parts sales, MRO activity and
contract flying; and
- an increase in aircraft leasing revenue under the CPA of
$3.9 million primarily due to a
higher US dollar exchange rate; partially offset by
- a decrease in capitalization of major maintenance overhauls on
owned aircraft of $1.8 million;
- a contracted decrease in Fixed Margin of $1.5 million; and
- an increase in general administrative expenses attributable to
increased operations.
Corporate Adjusted EBITDA of $(15.8)
million was higher than the same period 2022 by $2.4 million due to:
- an increase in general administrative expenses related to
higher professional fees, salaries, wages and benefits and travel
expenses; partially offset by
- a decrease in stock-based compensation of $0.9 million due to a decrease in the Common
Share price, offset by the change in fair value of the Total Return
Swap.
Adjusted net income of $56.4
million, an increase of $11.1
million over the same prior year period primarily due
to:
- a $40.7 million increase in
Adjusted EBITDA as previously described; partially offset by
- an increase in depreciation expense of $17.4 million primarily attributable to Falko and
capital expenditures in 2022;
- an increase of $8.2 million in
income tax expense; and
- an increase in net interest costs of $4.0 million primarily related to interest on
long-term debt assumed as part of the Falko Acquisition and the
draw on the Operating Credit Facility partially offset by the
redemption of the 6.00% Debentures in December 2022 and the recognition of income
related to the discontinuance of hedge accounting on an interest
rate swap.
Net income of $52.3 million, an
increase of $69.8 million over the
same prior year period primarily due to:
- the previously noted increase in Adjusted net income of
$11.1 million;
- a change in net foreign exchange of $25.4 million;
- a decrease in impairment provisions of $20.5 million;
- a decrease in restructuring credit loss provision of
$10.4 million;
- a decrease in strategic advisory fees of $8.4 million;
- a decrease in lease repossession costs of $7.1 million; partially offset by
- an increase in income tax expenses on adjusted items of
$13.0 million.
Consolidated Financial Analysis
This section provides detailed information and analysis about
Chorus' performance for the three and six months ended
June 30, 2023 compared to the three and six months ended
June 30, 2022. It focuses on Chorus' consolidated operating
results and provides financial information for Chorus' operating
segments.
(unaudited)
(expressed in
thousands of Canadian dollars)
|
Three months ended
June 30,
|
Six months ended
June 30,
|
2023
|
2022
|
Change
|
Change
|
2023
|
2022
|
Change
|
Change
|
$
|
$
|
$
|
%
|
$
|
$
|
$
|
%
|
|
|
|
|
|
|
|
|
|
Operating
revenue
|
396,775
|
392,343
|
4,432
|
1.1
|
812,027
|
734,723
|
77,304
|
10.5
|
Operating
expenses
|
341,391
|
385,529
|
(44,138)
|
(11.4)
|
694,740
|
684,597
|
10,143
|
1.5
|
|
|
|
|
|
|
|
|
|
Operating
income
|
55,384
|
6,814
|
48,570
|
712.8
|
117,287
|
50,126
|
67,161
|
134.0
|
Net interest
expense
|
(23,652)
|
(25,105)
|
1,453
|
(5.8)
|
(49,110)
|
(45,159)
|
(3,951)
|
8.7
|
Foreign exchange gain
(loss)
|
2,683
|
(22,441)
|
25,124
|
(112.0)
|
6,714
|
(17,992)
|
24,706
|
(137.3)
|
Gain on property
and equipment
|
10
|
156
|
(146)
|
(93.6)
|
10
|
156
|
(146)
|
(93.6)
|
Gain (loss) on fair
value of investments
|
599
|
(797)
|
1,396
|
(175.2)
|
2,491
|
(797)
|
3,288
|
(412.5)
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income tax
|
35,024
|
(41,373)
|
76,397
|
(184.7)
|
77,392
|
(13,666)
|
91,058
|
(666.3)
|
Income tax
(expense) recovery
|
(14,706)
|
970
|
(15,676)
|
1,616.1
|
(25,055)
|
(3,830)
|
(21,225)
|
554.2
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
20,318
|
(40,403)
|
60,721
|
(150.3)
|
52,337
|
(17,496)
|
69,833
|
(399.1)
|
Net income attributable
to non-controlling interest
|
1,267
|
439
|
828
|
188.6
|
1,757
|
439
|
1,318
|
300.2
|
Net income (loss)
attributable to Shareholders
|
19,051
|
(40,842)
|
59,893
|
(146.6)
|
50,580
|
(17,935)
|
68,515
|
(382.0)
|
Preferred share
dividends declared
|
(8,816)
|
(5,426)
|
(3,390)
|
62.5
|
(17,687)
|
(5,426)
|
(12,261)
|
226.0
|
Earnings (loss)
attributable to Common Shareholders
|
10,235
|
(46,268)
|
56,503
|
(122.1)
|
32,893
|
(23,361)
|
56,254
|
(240.8)
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1)
|
110,748
|
104,871
|
5,877
|
5.6
|
228,804
|
188,151
|
40,653
|
21.6
|
Adjusted
EBT(1)
|
35,045
|
34,189
|
856
|
2.5
|
76,834
|
57,535
|
19,299
|
33.5
|
Adjusted net
income(1)
|
25,576
|
27,586
|
(2,010)
|
(7.3)
|
56,400
|
45,330
|
11,070
|
24.4
|
(1) These
are non-GAAP financial measures.
|
|
|
|
Outlook
(See cautionary statement regarding
forward-looking information below)
Jazz's capacity is currently constrained as the industry-wide
demand for pilots intensifies. In the past 12-months, Jazz has seen
over 300 captain or captain-eligible pilots flow to Air Canada
under the existing pilot flow agreement, along with attrition to
other mainline airlines. In that same time period, Jazz has
successfully hired and trained over 300 first officers and
continues to see a good supply of new hire pilots.
Jazz expects this trend on flow of pilots to Air Canada and
attrition to other airlines to continue in the near term.
The CPA provides a Fixed Fee to Jazz regardless of flying
levels; therefore, the reduction in flying is not expected to have
any impact on Jazz's earnings.
Falko continues to have positive and advancing discussions on
its new fund (Fund III) with its existing lead investors in Fund II
and others. Chorus is also routinely exploring opportunities to
sell Falko's wholly-owned or majority-owned aircraft in order to
advance the implementation of its asset light leasing strategy.
Chorus has the key elements to successfully execute on its
strategy to transition to an asset light leasing model while
growing its contractual fund management business and its RAS
segment. The key elements include:
- Strong and predictable core earnings from the RAS segment, with
the potential to expand into adjacent and complementary business
lines;
- Significant wholly-owned or majority-owned aviation assets that
can be monetized to reduce debt and return capital to Common
Shareholders while also providing funding to improve the growth and
return profile of the business over time through accretive
investments; and
- Growth potential in the Falko series of funds from which Chorus
can generate attractive returns via asset management fees,
co-investment returns and incentive payments.
The asset light leasing model will enable Chorus to achieve
greater scale in its leasing business by co-investing alongside
third-party equity investors in Falko-managed funds, while
decreasing risk to Chorus by reducing the use of recourse debt
financing. As Chorus transitions to an asset light leasing model,
asset sales will generate Free Cash Flow that can be deployed to
pursue accretive investment opportunities and/or return capital to
Common Shareholders. As part of this asset light transformation,
Chorus is targeting:
- Aircraft asset sales: Chorus intends to
opportunistically trade RAL's wholly-owned or majority-owned
aircraft including in connection with the windup of its 67.45%
ownership in Ravelin Holdings LP by its tenth anniversary in 2025.
As of June 30, 2023, Ravelin Holdings LP held an interest in
39 aircraft with a net book value of US $397.9 million and secured debt of US
$206.6 million. As asset sales
occur, the related leasing revenues in RAL will decrease, which
will be partially offset by lower depreciation and debt
servicing costs and earnings from Falko managed funds.
- Reduced leverage: Chorus anticipates its Leverage Ratio
will be between 2.5 to 3.5 by December 31,
2024, given the contractual nature of Chorus' earnings,
amortizing debt repayments, and expected asset sales. Deleveraging
amounts will vary from quarter-to-quarter depending on the timing
and quantum of asset sales.
- Growth: Chorus intends to expand the number of Falko
managed funds and the RAS business into adjacent and complementary
specialty aviation business lines.
Chorus' forecast for the year ending December 31, 2023 is as follows:
(unaudited)
|
Consolidated
|
(expressed in
thousands of Canadian dollars)
|
|
To
|
|
$
|
$
|
|
|
|
Revenue(1)(2)
|
1,500,000
|
1,700,000
|
Adjusted
EBITDA(1)(3)
|
410,000
|
450,000
|
Adjusted
EBT(1)(3)
|
135,000
|
165,000
|
Leverage
Ratio(1)(3)
|
3.6
|
4.0
|
Free Cash
Flow(3)
|
260,000
|
330,000
|
|
|
|
(1)
|
RAL's forecast for
the year ending December 31, 2023 is as follows: Revenue is
expected to be between $250.0 million and $275.0 million, Adjusted
EBITDA is expected to be between $210.0 million and $235.0 million
and Adjusted EBT is expected to be between $70.0 million and $85.0
million.
|
(2)
|
Controllable Costs and
Pass-Through Costs are expected to be between $0.95 billion and
$1.1 billion included in both revenue and expenses.
|
(3)
|
These are non-GAAP
financial measures.
|
|
|
2023 Key Economic Assumptions:
- The forecast now assumes Fund III will close outside of the
2023 year. Fund III is anticipated to have (i) a minimum of US
$500.0 million in capital commitments
and (ii) management fees and economic terms commensurate with those
in Falko's prior funds.
- The forecast revenue is based on current contracted lease
revenue and forecasted revenues for leased aircraft and asset
management fees. Aircraft leasing revenue under the CPA and Fixed
Margin revenue is expected to be US $110.0
million and $63.0 million,
respectively, in 2023 (2022: US $114.5
million and $66.3 million,
respectively).
- Asset sales of approximately US $50.0
million to $100.0 million in
2023 with a loan-to-value of between 50% and 60% generating net
proceeds between US $25.0 million and
US $50.0 million. If material asset
sales are executed in 2023, this may reduce expected revenue in
RAL, depending on the timing of such sales.
- The forecast uses a foreign exchange rate of 1.30 for 2023 to
translate USD to CAD revenue.
RAL's gross lease receivable may decrease from the June 30, 2023 balance of US $108.2 million to between US $95.0 million and US $100.0 million by the end of 2023 due to rent
relief arrangements1 and repayment expectations.
RAL's lease deferral receivable exposure is partially mitigated
by security packages held of approximately US $17.5 million (December
31, 2022 - US $17.1
million).
1
|
Following the onset of
the COVID-19 pandemic, RAL received requests from many of its
customers for some form of temporary rent relief, as they coped
with an unprecedented reduction in demand for passenger air travel.
Under rent relief arrangements, certain of which include lease term
extensions, the repayment of the deferred amounts typically
coincides with the lease term extensions.
|
|
|
Capital Expenditures
Capital expenditures in 2023, are expected as follows:
(unaudited)
(expressed in
thousands of Canadian dollars)
|
|
|
|
Actual
|
|
|
|
Six months
ended
|
Year
ended
|
Planned
2023(1)
|
June 30,
2023
|
December 31,
2022
|
|
$
|
|
$
|
$
|
Capital expenditures,
excluding aircraft acquisitions
|
20,000
|
to
|
25,000
|
6,917
|
15,914
|
Capitalized major
maintenance overhauls(2)
|
8,000
|
to
|
13,000
|
7,310
|
15,974
|
Aircraft acquisitions
and improvements
|
8,000
|
to
|
12,000
|
4,177
|
30,392
|
|
36,000
|
to
|
50,000
|
18,404
|
62,280
|
(1)
|
The 2023 plan includes
reconfiguration costs on aircraft and certain aircraft improvements
which have been converted to Canadian from US dollars using a
foreign exchange rate of 1.3240, the June 30, 2023 closing day rate
from the Bank of Canada.
|
(2)
|
The 2023 plan includes
between $3.0 million to $5.0 million of costs that are expected to
be included in Controllable Costs. Actual 2023 and 2022 costs
include $4.2 million and $10.1 million, respectively, which were
included in Controllable Costs.
|
|
|
Use of Defined Terms
Capitalized terms used but not defined in this news release have
the meanings given to them in the MD&A which is available on
Chorus' website (www.chorusaviation.com) and under Chorus' profile
on SEDAR (www.sedar.com).
Investor Conference Call / Audio Webcast
Chorus will hold an analyst call at 9:00
AM ET on August 4, 2023 to
discuss the second quarter 2023 financial results. The call may be
accessed by dialing 1-888-664-6392. The call will be simultaneously
audio webcast via: https://app.webinar.net/1pArVer7RDX.
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 midnight ET, August 11,
2023, by dialing toll-free1-888-390-0541 and using passcode
749492 # (pound key).
1NON-GAAP FINANCIAL MEASURES
This news
release references several non-GAAP financial measures to
supplement the analysis of Chorus' results. Chorus uses certain
non-GAAP financial measures, described below, to evaluate and
assess performance. These non-GAAP measures are generally numerical
measures of a company's 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 a
standardized meaning, and are therefore not likely to be comparable
to similar measures presented by other public entities.
Adjusted Net Income, Adjusted EBT and Adjusted
EBITDA
Adjusted net income is used by Chorus to assess
performance without the effects of unrealized foreign exchange
gains or losses on long-term debt and lease liability related to
aircraft, employee separation program costs, impairment provisions,
lease repossession costs net of security packages realized,
restructuring expected credit loss provision, strategic advisory
fees and the applicable tax expense (recovery). Chorus manages its
exposure to currency risk on such long-term debt by billing the
lease payments within the CPA in the underlying currency (US
dollars) related to the aircraft debt. These items are excluded
because they affect the comparability of Chorus' financial results,
period-over-period, and could potentially distort the analysis of
trends in business performance. Excluding these items does not
imply they are non-recurring due to ongoing currency fluctuations
between the Canadian and US dollar.
Adjusted earnings available to Common Shareholders per Common
Share is used by Chorus to assess performance and is calculated as
Adjusted Net Income less non-controlling interest and Preferred
Share dividends declared.
Adjusted EBT and Adjusted EBITDA should not be used as exclusive
measures of cash flow because these measures do not account for the
impact of working capital growth, capital expenditures, debt
repayments and other sources and uses of cash, which are disclosed
in the statements of cash flows, forming part of Chorus' financial
statements.
EBT is defined as earnings before income tax. Adjusted EBT (EBT
before employee separation program costs, impairment provisions,
lease repossession costs net of security packages realized,
restructuring expected credit loss provision, strategic advisory
fees and other items such as foreign exchange gains and losses) is
a non-GAAP financial measure used by Chorus as a supplemental
financial measure of operational performance. Management believes
Adjusted EBT assists investors in comparing Chorus' performance by
excluding items, which it does not believe will re-occur over the
longer-term (such as employee separation program costs, impairment
provisions, lease repossession costs net of security packages
realized, restructuring expected credit loss provision, and
strategic advisory fees) as well as items that are non-cash in
nature such as foreign exchange gains and losses.
EBITDA is defined as earnings before net interest expense,
income taxes, depreciation and amortization and impairment and is a
non-GAAP financial measure that is used frequently by companies in
the aviation industry as a measure of performance. Adjusted EBITDA
(EBITDA before employee separation program costs, strategic
advisory fees, impairment provisions, lease repossession costs net
of security packages realized, restructuring expected credit loss
provision and other items such as foreign exchange gains or losses)
is a non-GAAP financial measure used by Chorus as a supplemental
financial measure of operational performance. Management believes
Adjusted EBITDA assists investors in comparing Chorus' performance
by excluding items, which it does not believe will re-occur over
the longer-term (such as employee separation program costs,
impairment provisions, lease repossession costs net of security
packages realized, restructuring expected credit loss provision and
strategic advisory fees) as well as items that are non-cash in
nature such as foreign exchange gains and losses. Adjusted EBITDA
should not be used as an exclusive measure of cash flow because it
does not account for the impact of working capital growth, capital
expenditures, debt repayments and other sources and uses of cash,
which are disclosed in the statements of cash flows, forming part
of Chorus' financial statements.
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. Leverage
Ratio is not a recognized measure under GAAP, and therefore is
unlikely to be comparable to similar measures presented by other
companies. Management believes leverage to be a useful term 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
should not be construed as a measure of cash flows.
Free Cash Flow
Free Cash Flow is defined as cash
provided by operating activities less net changes in non-cash
balances related to operations, capital expenditures excluding
aircraft acquisitions and improvements plus net proceeds on asset
sales (proceeds on disposal of property and equipment less the
related debt repayments for the assets sold).
Forward-Looking Information
This news release includes
forward-looking information and statements. Forward-looking
information and statements are identified by the use of terms and
phrases such as "anticipate", "believe", "could", "estimate",
"expect", "intend", "may", "plan", "potential", "predict",
"project", "will", "would", and similar terms and phrases,
including references to assumptions. Such information and
statements may involve but are not limited to comments with respect
to strategies, expectations, planned operations or future actions.
Forward-looking information and statements relate to analyses and
other information that are based on forecasts of future results,
estimates of amounts not yet determinable and other uncertain
events. Forward-looking information and statements, by their
nature, are based on assumptions, including those referenced below,
and are subject to important risks and uncertainties. Any forecasts
or forward-looking predictions or statements cannot be relied upon
due to, among other things, external events, changing market
conditions and general uncertainties of the business. Such
information and statements involve known and unknown risks,
uncertainties and other factors that may cause actual results,
performance or achievements to differ materially from those
indicated in the forward-looking information and statements.
Examples of forward-looking information and statements in this
news release include the discussion in the Outlook section, as well
as statements regarding expectations as to Chorus' future liquidity
and financial strength and contracted revenues, Chorus' future
growth and competitive position, the growth of Falko's asset
management business, the transition of Chorus' leasing
business to an asset light leasing model, the generation of cash
flows from asset sales and potential deployment of those proceeds
to enhance returns to Shareholders and/or invest in accretive
growth opportunities, the completion of pending or planned
transactions (including the successful close of Falko's Fund III),
and Jazz's efforts to increase flying capacity under the CPA.
Actual results may differ materially from results indicated in
forward-looking information for a number of reasons, including if:
any one or more of the key assumptions described in the Outlook
section fails to materialize; Chorus is unable to successfully
realize the anticipated benefits of the Falko acquisition,
including the transition to an asset light model; Falko is unable
to successfully launch Fund III on the terms currently contemplated
or at all; Chorus (including any of its subsidiaries) is unable to
attract and retain the type and number of human resources it needs
to operate its business; new COVID-19 variants and/or new pandemic
or endemic diseases emerge and restrictive measures are implemented
to minimize their public health impacts; the effects of the
COVID-19 pandemic continue to adversely impact the financial health
of Chorus' contractual counterparties; general economic conditions
(including inflation and interest rates) worsen, or general
conditions for the aviation industry deteriorate; payments cease
(in whole or in part) under the CPA and/or under aircraft lease
agreements with Chorus' customers; disputes emerge under the CPA
and/or under aircraft lease agreements; Chorus defaults under any
of its debt covenants; asset impairments and/or provisions for
expected credit losses are required; changes in law are made
(including regulations relating to climate change) which adversely
affect Chorus' business; transactions (including potential
financings) referenced in this news release or in Chorus' public
disclosure record fail to conclude on the terms currently
contemplated or at all; and/or one or more of the risk factors
referenced in Chorus' most recent Annual Information Form and in
its public disclosure record available on SEDAR at www.sedar.com
materializes. The forward-looking statements contained in this news
release represent Chorus' expectations as of the date of this news
release (or as of the date they are otherwise stated to be made)
and are subject to change after such date. Chorus disclaims any
intention or obligation to update or revise such statements to
reflect 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 Aviation Inc.
Chorus is a leading, global aviation solutions provider and
asset manager, focused on regional aviation. Our principal
subsidiaries are: Falko Regional Aircraft, the leading pure play
regional aircraft asset manager and lessor, managing investments on
behalf of third-party fund investors; Jazz Aviation, the largest
regional operator in Canada and
provider of regional air services under the Air Canada Express
brand; Voyageur Aviation, a leading provider of specialty charter,
aircraft modifications, parts provisioning and in-service support
services; and Cygnet Aviation Academy, an industry leading
accredited training academy preparing pilots for direct entry into
airlines. Together, Chorus' subsidiaries provide services that
encompass every stage of a regional aircraft's lifecycle,
including: aircraft acquisition and leasing; aircraft
refurbishment, engineering, modification, repurposing and
transition; contract flying; aircraft and component maintenance,
disassembly, and parts provisioning; and pilot training.
Chorus Class A Variable Voting Shares and Class B Voting Shares
trade on the Toronto Stock Exchange under the trading symbol 'CHR'.
Chorus 5.75% Senior Unsecured Debentures due December 31, 2024, 6.00% Convertible Senior
Unsecured Debentures due June 30,
2026, and 5.75% Senior Unsecured Debentures due June 30, 2027 trade on the Toronto Stock Exchange
under the trading symbols 'CHR.DB.A', 'CHR.DB.B', and 'CHR.DB.C'
respectively. www.chorusaviation.com.
SOURCE Chorus Aviation Inc.