Air Canada stock swoons on Q3 loss

3-month TSX trading in Air Canada

Higher fuel costs and financial charges caused a $405-million swing to loss from profit in Air Canada's third quarter, the company said Friday.

The carrier reported a loss of $132 million ($1.32 a share) for the three months ended Sept. 30, compared with a profit of $273 million ($2.73 million) in the third quarter of 2007.

Air Canada stock nose-dived in TSX trading, dropping 91 cents or nearly 17 per cent to $4.49.

Fuel costs in the quarter rose by $348 million to $1.1 billion, the company said.

The loss also included $93 million on financial instruments, mostly on fuel hedge contracts, and losses on foreign currency of $87 million. Last year, Air Canada made $273 million on financial transactions.

Revenue in the quarter was $3.08 billion, compared with $2.95 billion a year ago.

The company is continuing to cut costs and expects to reach savings of $100 million by year-end, president and CEO Montie Brewer said in a statement.

Loss for the nine months ended Sept. 30 was $298 million ($2.98 a share), compared with a profit of $394 million ($3.94 a share) a year earlier.

Revenue for the nine months was $8.58 billion, compared with $8.13 billion a year ago.