Chorus Aviation Reports Fourth Quarter and Year-end 2025 Financial Results

Executive Summary

• Chorus Aviation reported strong fourth-quarter and full-year 2025 financial results, driven by a significant turnaround in net income from continuing operations and improved adjusted earnings metrics compared to the prior year.
• The company announced a 38% increase in its quarterly dividend to $0.11 per share and authorized up to $100 million in common share buybacks over the next four years.
• Chorus entered into an agreement to acquire Kadex Aero Supply Limited, a distributor of aircraft parts and supplies, for approximately $50.0 million, marking a strategic move to build higher-margin platforms.

Key Details

• Q4 2025 Financial Highlights:
  • Net income from continuing operations: $16.7 million (vs. loss of $49.4 million in Q4 2024).
  • Adjusted EBITDA: $47.1 million (vs. $51.0 million in Q4 2024).
  • Adjusted Earnings available to Common Shareholders: $13.8 million ($0.57 per share) (vs. $9.3 million / $0.34 per share in Q4 2024).
  • Free Cash Flow: $27.0 million (vs. $27.5 million in Q4 2024).
  • Leverage Ratio: 1.7x (vs. 1.4x at Dec 31, 2024).
• Full Year 2025 Financial Highlights:
  • Net income from continuing operations: $78.7 million (vs. loss of $15.8 million in 2024).
  • Adjusted EBITDA: $206.9 million (vs. $209.0 million in 2024).
  • Adjusted Earnings available to Common Shareholders: $58.6 million ($2.27 per share) (vs. $26.6 million / $0.97 per share in 2024).
  • Free Cash Flow: $135.3 million (vs. $118.8 million in 2024).
• Capital Return & Share Buybacks:
  • Dividend increased by 38% to $0.11 per common share (up from $0.08 initiated in June 2025).
  • Purchased and cancelled 3,759,929 common shares in Q4 2025 for $85.2 million (approx. 14% of Dec 31, 2024 outstanding shares).
  • Announced up to $100 million in planned common share buybacks over the next four years.
  • Total capital returned to shareholders since the beginning of 2025: over $89 million via dividends and repurchases.
• M&A Activity:
  • Agreement to acquire Kadex Aero Supply Limited for approximately $50.0 million.
  • Kadex is a distributor of aircraft parts and supplies; acquisition aims to build higher-margin platforms and enhance cash flows.
• 2026 Outlook:
  • Projected Adjusted EBITDA: $170.0 million to $185.0 million.
  • Projected Free Cash Flow: $100.0 million to $110.0 million.
  • Projected Free Cash Flow after repayment of Amortizing Term Loans: $36.0 million to $46.0 million.
  • Fixed Margin from CPA: $43.9 million.
  • Capital Expenditures (excluding aircraft): $24.0 million to $29.0 million.
  • Capitalized major maintenance overhauls: $3.0 million to $8.0 million.
  • Aircraft acquisitions and improvements: $9.5 million to $14.5 million.
• Operational Metrics:
  • Portfolio of 47 wholly-owned aircraft and five spare engines under the CPA.
  • Current net book value of leased aircraft: $720.5 million.
  • Future contracted lease revenue (US$): $300.6 million.
  • Long-term debt: $261.3 million (US$190.6 million), 100% fixed rate, weighted average cost of borrowing 3.29%.
  • Cabin refurbishment program initiated for Jazz aircraft (E-175s, CRJ900s, and select Dash 8-400s) with costs paid by Air Canada.

Notable Quotes

• "Today's announcements mark exciting milestones for Chorus, reflecting our execution against our strategy. Our financial results demonstrate strong and stable performance throughout the quarter and year," said Colin Copp, President and Chief Executive Officer.
• "Our decision to increase our quarterly dividend to $0.11 per common share reflects our strong Free Cash Flow as well as confidence in the long‑term trajectory of our business. At the same time, our planned share repurchases underscore our commitment to shareholder value," said Mr. Copp.
• "The acquisition of Kadex demonstrates Chorus' ability to execute against our growth strategy of building higher‑margin platforms and enhancing our overall cash flows. Kadex will also further strengthen our overall aviation, aerospace and defence platforms," said Mr. Copp.