WestJet Airlines said on Tuesday its first-quarter earnings fell 28.7 percent as the soft economy ate into demand and competition in the industry led to lower pricing.
Canada’s No. 2 carrier earned CAD$37.4 million (USD$32 million), or 29 Canadian cents a share, down from a year-earlier CAD$52 million, or 40 Canadian cents a share.
Revenue decreased 3.3 percent to CAD$579.3 million.
WestJet, which competes with the country’s dominant carrier, Air Canada, warned in March of a gloomier outlook because of a weaker economy and stiff competition on fares.
The airline added 7.2 percent capacity in the first quarter on an available seat mile basis. That cut its load factor by 1.5 percentage points to 80.4 percent.
“While the weakened economy had a negative impact on our first quarter financial results, our margins continued to be among the strongest in North America,” Sean Durfy, WestJet’s chief executive, said in a statement.
“Softening demand, aggressive competitor pricing and Easter falling in the second quarter of 2009, versus the first quarter of 2008, all contributed to our decline in RASM (revenue per available seat mile). However, lower fuel prices resulted in a decline in CASM (cost per available seat mile) and contributed to our overall profitability.”